The options market for XRP on Deribit is experiencing a significant surge in activity, with the call option above the $1 price emerging as the most favored option on the exchange.
Notably, the $1.10 option represents a bet that the price of XRP will double by the end of the month, considering it is currently valued at $0.566. At press time, the open interest for this option, which expires on Aug. 30, stands at 4,362,000 contracts, valued at $2.46 million. This figure makes it the most popular XRP option on the Deribit exchange.
Notably, the XRP options market launched only five months ago. In that time, active bets have increased by over 830,000 contracts.
For context, when a buyer places a call option, the instrument allows him to purchase XRP at the agreed price sometime in the future but before the date of expiry. Essentially, a call buyer is optimistic about the market’s prospects by betting that the price will rise above the strike price at which the call was purchased.
Factors Driving Increased Bets on XRP Attaining $1.10
Griffin Ardern, Head of Options Trading at BloFin, stressed that if XRP breaks the $0.75 barrier, it sets the stage for continuation towards $1.10. Moreover, he also suggested that the possibility of institutions applying for an XRP exchange-traded fund (ETF) in the U.S. could be a key factor driving up prices.
Additionally, the optimism surrounding XRP’s price prospects may be driven by the recent court ruling in favor of Ripple Labs. The development has sparked hopes of a potential XRP ETF launching in the U.S.
“Wen XRP ETF,” tweeted Nate Geraci, President of ETF Store, in response to Ripple’s lawsuit victory.
Wen XRP ETF? pic.twitter.com/P4K1FJmKc9
— Nate Geraci (@NateGeraci) August 8, 2024
Notably, the SEC’s approval of Bitcoin and Ethereum ETFs opened doors to billions of dollars in mainstream money, impacting the price of BTC and ETH. Investors may be betting on XRP as it is likely the next in line.
$1.10 For XRP This Month is Overambitious
However, not everyone is convinced that XRP prices can rally beyond $1.10 by the end of August. Trader Martin Cheung cited that XRP has already rallied significantly this year and that a potential ETF announcement might increase prices by around 20%, but $1.10 looks too ambitious.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
