Ripple’s Stablecoin Announcement Sparks Surge in XRP Open Interest and Price Rally
Ripple Labs’ recent announcement of its plan to introduce a native stablecoin on the XRP ledger has provided a significant boost to the XRP price rally. Within 24 hours of the stablecoin launch news, the XRP Open Interest surged from $899 million to $981.2 million, representing a 9% increase.
The XRP price has been on an upward trajectory over the last two days, gaining more than 3% and moving closer to the $0.60 mark. The market capitalization of XRP has also surged to $32.5 billion. This recent price surge comes on the heels of Ripple Labs’ announcement of the launch of its native stablecoin, as reported by Crypto News Flash.
Ripple Labs unveiled its intention to introduce a proprietary stablecoin on the XRP ledger blockchain network on April 4. The upcoming Ripple stablecoin, slated for release later this year, will maintain a 1-to-1 peg with the US dollar. According to the company’s announcement, the stablecoin will be supported by cash equivalents, such as U.S. dollar deposits, U.S. government bonds, and other low-risk investments.
The current size of the global stablecoin market is $150 billion, with Tether’s USDT occupying a significant share of 69.5%, with a valuation of over $100 billion. Interestingly, the size of the stablecoin market is projected to grow 20-fold by 2030, reaching $2.8 trillion. Recognizing this massive market opportunity, Ripple’s launch of its native stablecoin comes at a critical time.
Ripple President Monica Long noted that the XRP Ledger’s inherent features, including a decentralized exchange and automated market maker, are designed to leverage XRP as the bridge currency. The introduction of a credible stablecoin to the XRPL is anticipated to foster increased adoption and development, enhancing the overall ecosystem.
The on-chain activities detected on April 4 indicate that XRP holders are strategically positioning themselves in anticipation of a favorable price effect following the announcement of the stablecoin launch. Within 24 hours of Ripple’s proposed stablecoin launch announcement, XRP Open Interest surged from $899 million to reach $981.2 million, marking a significant 9% increase, which surpassed the 3% growth in XRP price observed within the daily timeframe.
The notable rise in open interest implies the influx of new funds into the market, indicating that investors are opening new positions at a faster pace than those closing existing ones. If this trend continues and the market continues to deepen with increased liquidity, a potential XRP price breakout towards $0.70 could be on the horizon. However, the XRP price should reclaim the critical $0.65 level to confirm this optimistic XRP price projection.