XRP Outperforms Crypto Market Amid Bullish Sentiment
XRP has rallied significantly today following the approval of the world’s first spot XRP exchange-traded fund (ETF) in Brazil. The cryptocurrency has outperformed the broader crypto market, registering a 5% gain in the past 24 hours to trade above $2.67. Meanwhile, the global crypto market capitalization has seen a modest increase of 1.6%, reaching $3.23 trillion.
Brazil Approves Spot XRP ETF
The primary catalyst behind XRP’s price surge is the approval of the first-ever spot XRP ETF by Brazil’s securities regulator, the Comissão de Valores Mobiliários (CVM).
Key details:
- On 19 February, the CVM approved Hashdex’s Nasdaq XRP Index Fund for trading in Brazil.
- Named HASHDEX Nasdaq XRP FUNDO DE ÍNDICE, the fund is currently in its pre-operational phase, with an official start date yet to be announced.
- This marks a significant milestone for XRP adoption, providing both institutional and retail investors with a regulated investment vehicle that bypasses the complexities of direct ownership.
- With a population of over 200 million and a rising interest in cryptocurrency investments, Brazil presents a substantial market for this ETF.
In the United States, the Securities and Exchange Commission (SEC) is currently reviewing multiple applications for spot XRP ETFs from major asset managers, including CoinShares, Bitwise, 21Shares, and Grayscale.
Market sentiment has strengthened further, with the odds of a US spot XRP ETF approval on Polymarket increasing from 78% on 17 February to 80% at present. The SEC acknowledged Grayscale’s XRP ETF filing on 13 February and is also reviewing a request by Cboe BZX to list asset manager 21Shares’ XRP ETF.
XRP OI-weighted funding rate. Source: CoinGlass
Bloomberg ETF analysts James Seyffart and Eric Balchunas estimate a 65% chance of the SEC approving an XRP ETF in 2025. If granted, analysts at JP Morgan suggest the approval could validate XRP’s legitimacy and attract billions in capital inflows.
The Brazil approval has already fuelled optimism, evident in XRP’s immediate price surge from $2.51 to an intraday high of $2.74 on 20 February.
XRP Open Interest Increases by Nearly 20%
XRP’s latest price rally is supported by growing interest among derivatives traders, who are increasingly opening new positions, indicating a rise in speculative activity.
Key trends:
- XRP’s open interest (OI) has surged by 18% over the past week, rising from $3.48 billion on 13 February to $4.11 billion on 20 February.
- In the last 24 hours alone, OI has increased by 6.7%, according to CoinGlass data.
- The funding rate, which represents periodic payments exchanged between long and short traders in perpetual futures contracts, has turned positive at 0.0041%.
- This suggests that more traders are now taking long positions (betting on further price increases) rather than short positions (expecting a decline).
The rise in OI and the shift to a positive funding rate indicate strong speculative momentum in the XRP market, adding to the bullish outlook.
XRP/USD daily chart.
XRP Price Targets 26% Gains
Market analysts predict XRP/USD could maintain its upward trajectory as a key technical indicator turns bullish.
- XRP has flipped the $2.70 level into support, backed by the 50-day simple moving average (SMA).
- Bulls are now aiming to push past the $2.80 resistance level to sustain the rally and prevent a potential pullback.
- If successful, this could increase the likelihood of retesting the multi-year high above $3.40, representing a 26.5% gain.
However, caution is advised as the relative strength index (RSI) has declined slightly from 54 to 51 over the past 24 hours. While XRP remains above the 50-day SMA, the dip in RSI suggests the possibility of a bull trap.
A daily candlestick close below $2.55 could trigger a sell-off, pushing the price down toward the 100-day SMA at $2.30. As market dynamics evolve, traders should remain vigilant and assess key levels before making investment decisions.
