In a sudden move, the cryptocurrency market flipped extremely bearish, causing major digital assets such as XRP to drop sharply. After days of trading above the $2 price mark, the altcoin has fallen below this level, bringing it to the key $1.80 support. While the leading altcoin continues to face heightened volatility, its derivatives market is telling a different story.

Traders Crowd Back Into The XRP Market

XRP’s price action and its derivatives market are moving in different directions as traders continue move back into the altcoin. On-chain data shows that derivatives activity is heating up, with Open Interest (OI) undergoing a sharp rise after weeks of downward performance or sluggish growth.

A crypto pundit and investor, Xaif Crypto, reported that XRP open interest has moved above its 30-day average as volatility reaches its highest level since November 2025. This rise in open interest is centered on Binance, the largest cryptocurrency exchange in the world.

As both speculative positioning and hedging activity pick up pace in reaction to broader price swings, the rise suggests a resurgence of trader activity. Furthermore, heightened volatility and rising open interest frequently indicate a turning point, when leverage is increasing, and the market is preparing for a big move.

The chart indicates that the total open interest is around $566 million against a 30-day average near $529 million. These figures suggest that new positions are steadily entering the market, not aggressively.  However, this is not the major signal of the trend. 

Currently, rising open interest volatility, with the standard deviation at its highest level in months, is the primary indicator. Meanwhile, the Z score is still moderate, sitting around the 0.57 level. Xaif Crypto stated that this development suggests cautious accumulation and growing risk without extreme leverage in the market. 

It is worth noting that these conditions typically unfold prior to a strong directional move. With the current setup, XRP has entered a more dynamic and reactive trading environment than it has seen in months, regardless of whether this surge of activity resolves into continuation or reversal.

A Steady Wave Of Capital Inflows

A recent CoinShares report from Xaif Crypto shows that XRP is still attracting fresh capital at a significant rate. Despite a volatile market condition, weekly inflows have extended, pointing to a growing confidence among investors in the leading altcoin.

In the past week, the token pulled in over $69.5 million in inflows. This figure shows that demand is persistently building beneath the surface, indicating rising accumulation rather than speculative interest. While markets have shifted toward a volatile state, fresh capital is still being rotated into XRP.

The capacity of XRP to attract investment even in slower times is becoming a more significant indicator for its medium-term prospects. As both institutional and large-scale participants flock in, this raises the discussion that a bigger move might be imminent, and these investors are positioning themselves ahead of it.

Digital asset investment products recorded $2.17bn in inflows last week marking their strongest weekly inflows since October 2025, according to the latest data from CoinShares.

The surge came despite a sharp deterioration in sentiment toward the end of the week driven by geopolitical tensions, renewed tariff threats and uncertainty surrounding US monetary policy leadership.

Inflows were front-loaded earlier in the week before reversing on Friday when digital asset products saw $378M in outflows following diplomatic escalation related to Greenland and renewed concerns over global trade policy.

Markets were also unsettled by indications that Kevin Hassett — widely viewed as a policy dove and a leading contender for the next US Federal Reserve Chair — is likely to remain in his current role.

Bitcoin Dominates While Ethereum and Solana Show Resilience

At the asset level Bitcoin continued to dominate attracting $1.55 billion in inflows reinforcing its role as the primary institutional gateway into digital assets during periods of uncertainty. CoinShares notes that Bitcoin inflows remained robust despite macro-driven volatility and regulatory noise.

Ethereum and Solana also demonstrated resilience. Ethereum products recorded $496M in inflows, while Solana attracted $45.5M even as lawmakers in the US Senate Banking Committee floated proposals under the CLARITY Act that could restrict yield-bearing stablecoins.

The continued inflows suggest investors remain confident in the long-term utility of smart contract platforms despite evolving regulatory risks.

Broad-Based Altcoin Demand Persists

Beyond the major assets, a wide range of altcoins posted positive flows, highlighting improving risk appetite earlier in the week. XRP led altcoin inflows with $69.5M, followed by Sui ($5.7M), Lido ($3.7M) and Hedera ($2.6M).

CoinShares data indicates that while altcoin allocations remain modest compared to Bitcoin and Ethereum, investors are selectively re-engaging with the broader market, favouring assets with established liquidity, infrastructure, or clear network narratives.

Regional Strength and Blockchain Equities Stand Out

Regionally, flows were overwhelmingly positive. The US led with $2.05 billion in inflows, while Germany ($63.9M), Switzerland ($41.6M), Canada ($12.3M) and the Netherlands ($6.0M) also saw notable demand.

Blockchain equities also delivered a strong performance, attracting $72.6M in inflows during the week. According to CoinShares the strength in equity-linked products underscores sustained investor interest across the wider digital asset ecosystem, extending beyond tokens into publicly listed companies tied to blockchain infrastructure and services.

While late-week sentiment weakened CoinShares’ data suggests institutional demand for digital asset exposure remains resilient, with investors continuing to allocate capital despite macroeconomic and geopolitical uncertainty.

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