Short Sellers Get REKT as XRP Shoots up 25% in 24 Hours

Ripple’s XRP token enjoyed a 25% boost, buoyed by market optimism after the announcement of SEC Chair Gensler’s upcoming resignation. Today’s surge adds nicely to the previous gains of the altcoin, corresponding to the 180% monthly returns. The altcoin, however, remains around 50% below its all-time high of $3.30. 

Today’s surge is a continuation of a broader bullish momentum that has been building up since the US elections that saw Donald Trump return to the White House for the second term. Trump, one a crypto skeptic, emerged as the champion of the industry, vowing to make the US “the crypto capital of the planet” and establish a strategic reserve of bitcoin, a promise that is heating the crypto market in anticipation of his inauguration on January 20, 2025.

With Bitcoin on the verge of hitting the $100k mark, altcoins are in full force to the moon as well. On Friday, Solana set a new ATH above $263 but has since slipped to $256. Meanwhile, Ethereum’s open interest surged to the record high of $20.8 billion, surpassing its previous high of $17 billion in May.

As XRP had one of the most impressive crypto rallies over the last 24 hours, the momentum seems to be still there and going strong. Market indicators for XRP send a confident buy signal to traders, although the short-term correction is not out of the table. 

According to Coinglass, the open interest in XRP, similarly to Ethereum, has reached an all-time peak today at $2.61 billion, following the 26% surge over the last 24 hours.

Open interest is the total value of outstanding derivative contracts, such as futures and options, that are currently active and have not been settled yet. It is used as a key indicator of market sentiment. In the case of XRP, it seems that many traders are anticipating future price movements to capitalize on. With the long/short ratio of 0.9658, bulls and bears seem to be almost evenly matched, with a slight bias towards shorts hinting at the possibility of a correction. 

At the same time, today’s rally was merciless to short sellers. Over the last 24 hours, short positions worth $19 million were liquidated, outpassing long liquidations. 

While market sentiment for now enjoys bullish momentum, the looming possibility of a correction underscores the need for thorough risk management. However, the long-term outlook for XRP remains decidedly bullish. 

As Gensler’s departure opens an opportunity for Ripple to reach an amicable settlement with the SEC, more asset managers are getting ready to bring XRP products to the stock market. The applications for spot XRP ETF filed by Bitwise and Canary Capital are expected to receive a green light from the SEC’s new chair. Meanwhile, global asset manager WisdomTree announced today the launch of a similar product for the EU market. WisdomTree Physical XRP ETP (XRPW) will be available on several European exchanges, including Deutsche Börse Xetra, SIX Swiss Exchange, and Euronext.

Crypto analyst Ali Martinez believes that Gensler’s departure is the best thing that could happen to XRP, eyeing $2 as the next price target for the altcoin. 

A similar view was echoed by CrediBULL Crypto, who suggested that XRP may set a new all-time high after tanning the $2 level. The analyst pointed out that XRP’s monthly RSI has entered overbought territory for the first time in months. In analyst’s opinion, a higher RSI indicates strong momentum and a bullish trend for a coin, absent any bearish divergencies. The trader opined that a slight pullback is to be expected on the way, but nothing major.  

Earlier, CrediBULL Crypto expressed his belief that XRP is going to outperform Bitcoin and Ethereum in this cycle, reaching new ATH much quicker than most expect.

As the position of the next SEC Chair is soon to become vacant, the names of several likely candidates have been floated around. Among the frontrunners is SEC commissioner Hester Peirce, whose support for the crypto industry has earned her the moniker “Crypto Mom.” Another pro-crypto SEC commissioner, Mark Uyeda, is also named as one of the candidates for the job. 

According to Reuters, former SEC commissioner Paul Atkins, CEO of consultancy Patomak Global Partners, and Willkie Farr & Gallagher law firm partner Robert Stebbins, who served as SEC general counsel during Trump’s first administration, are among the top candidates as well. 

Finally, Robinhood CLO Dan Gallagher, reportedly a top contender to lead the reformed SEC, has recently bowed out of consideration for the role.