The Crypto Basic

XRP is now witnessing renewed interest, as its estimated leverage ratio on Binance soars to a two-month peak.

Notably, this surge in leverage ratio occurred on the back of a recent price rebound effort from XRP, as it leveraged the broader market upward push to reclaim the $1.54 price area for the first time since March.

Key Points

• The recent price recovery pushed XRP to $1.54 on May 14 before a pullback emerged.
• During the price rebound, the Binance leverage ratio rose to 0.179, its highest level in two months.
• As prices pulled back, XRP futures volume dropped over 40% to $3.7 billion, and open interest fell 6.69% to $2.86 billion.
• Long positions make up about 97% of the $7.62 million total liquidations, confirming bullish losses.

XRP Recovers as Market Sentiment Improves

Verified CryptoQuant analyst Arab Chain was the first to highlight the current market situation during the recent price rebound. Specifically, XRP saw a strong recovery in recent days as the wider crypto market turned positive again. 

The token rose from $1.38 on May 8 to a two-month high of $1.54 on May 14 amid renewed buying interest from traders. While XRP later pulled back from this peak, the rally still brought renewed attention to the asset and increased activity in its derivatives market.

XRP Binance Leverage Ratio Hits 2-Month High

During the recovery, Arab Chain called attention to a sharp rise in Binance’s Estimated Leverage Ratio (ELR). In his latest analysis, he explained that traders had started using more leverage as XRP’s price moved higher.

According to Arab Chain, Binance’s XRP Estimated Leverage Ratio climbed to around 0.179, reaching its highest level in nearly two months. The increase came while XRP traded close to $1.48. He noted that the ELR had moved steadily higher over the past few days after staying weak since mid-March. 

Earlier, the indicator remained at relatively low levels, but the latest jump pushed it to its strongest reading in two months. This rise showed that traders had become more active in leveraged XRP positions, especially in the futures market.

Arab Chain also attributed the increase in leverage to XRP’s gradual price recovery in recent weeks. He suggested that part of the new money entering the market likely came from traders expecting more upside movement or stronger short-term volatility.

However, the analyst warned that higher leverage also increases market risk. When too many traders use leverage, sudden price swings can trigger large liquidation events if the market moves against open positions.

XRP Derivatives Activity Slows After Pullback

While leverage levels rose during the rally, recent data from CoinGlass indicates that XRP derivatives activity has weakened after the price pulled back from $1.54.

The data shows that XRP futures volume dropped by more than 40% over the past 24 hours to $3.7 billion at press time. Open Interest also fell by 6.69% to $2.86 billion as liquidations increased and some traders closed their positions after the recent decline.

Meanwhile, XRP’s long-to-short ratio in the last 24 hours stood at 0.8911. This figure confirms that traders now hold more short positions, indicating a growing bearish outlook across the market.

Long Liquidations Trigger Bearish Sentiment

Liquidation data further explains why the market is seeing a change in sentiment. Specifically, over the past 24 hours, XRP recorded $7.62 million in liquidations, with long positions making up $7.44 million, or about 97% of the total.

The same pattern appeared across shorter timeframes. In the last 12 hours, long positions accounted for $2.42 million out of $2.43 million in total liquidations. Over the past four hours, long liquidations reached $2.28 million from a total of $2.29 million.

The heavy wave of long liquidations followed XRP’s drop from $1.54 to its current price of $1.41. As bullish trades got wiped out, many traders pivoted toward bearish positions and started expecting further downside. This change in sentiment also helped drive Open Interest lower.

Still, when too many traders lean bearish, the market sometimes moves in the opposite direction. For now, XRP needs to hold above the important $1.40 support level to avoid a deeper decline in the near term.

Data from Santiment confirms that the recent XRP price recovery resulted in a major rise in network activity on the XRPL.

XRP recently joined the broader crypto market recovery, climbing to a weekly high of $1.5487 before meeting resistance and falling back below $1.5. While the rally has slowed, new data shows that the price increase came alongside a jump in activity on the XRP Ledger (XRPL).

Key Points

• XRP’s price rose above $1.54 before pulling back below the $1.5 level amid broader market recovery.
• Santiment reported 48,453 active XRPL addresses, the highest daily figure since March 30.
• XRPL network growth reached 3,317 new wallets, its strongest reading since March 19.
• Activated accounts have now climbed to 7,856,080, moving closer to the 8 million milestone.

XRP Price Rally Leads to Increased Network Activity

Market analytics platform Santiment reported that the recent XRP rally pushed network activity to its highest level in nearly two months. According to the firm, XRP’s move above $1.54 for the first time in two months helped drive a strong increase in on-chain activity across the XRPL.

Santiment revealed that active addresses on the network reached 48,453 within a 24-hour period, the highest level since March 30. Also, network growth rose to 3,317, marking its strongest reading since March 19.

The analytics firm explained that much of the increase likely came from investor excitement surrounding XRP’s latest price move. 

Despite this, Santiment noted that higher transaction activity remains an important sign for both medium- and long-term price growth. According to the platform, wider adoption across a blockchain network usually justifies higher valuations.

Network Growth Trends

Data from Santiment’s chart shows that new wallet creation on the XRPL stayed relatively low for most of May. Before the latest surge, the metric only saw a gradual increase from late April into the beginning of the month.

This trend later weakened, with newly created wallets dropping to the low 2,200 range on May 10. However, the metric recovered the following day and has continued moving higher. This recovery eventually pushed network growth to the latest figure of 3,317 new wallets.

Following the recent rise in wallet creation, activated accounts on the XRP Ledger have now climbed to 7,856,080. With the current pace, the network is now moving closer to the major milestone of 8 million wallets.

Meanwhile, unlike wallet growth, active address activity did not follow a steady trend during this period. Santiment’s chart shows that the metric continued to move between daily highs and lows without a clear direction.

XRPL Onchain Data

Separate blockchain data from XRPScan also confirmed the recent increase in XRPL activity. According to XRPScan, the “number of active users (source tag + destination tag)” metric moved above 184,000 on May 15.

This figure marked the second-highest reading recorded since the beginning of April. For context, the network uses this metric to estimate daily active users by tracking unique addresses involved in transactions that include Source Tags or Destination Tags.

The data also shows a rise in failed transaction attempts across the network. Specifically, XRPScan reported that transactions returning the “tecNO_PERMISSION” error climbed to 1,332 on May 19, the highest level since March 31. This error appears when a sender lacks permission to complete an operation.

Also, transactions producing the “tecINSUFFICIENT_FUNDS” error rose to 656 on May 19, marking the highest reading since April 19. This error occurs when the sender does not hold enough of the required asset to complete the transaction.