Skip to content
- Bybit lost 36% XRP open interest during liquidation-driven market reset.
- Binance traders maintained exposure despite heavy XRP derivatives turbulence.
- XRP rebounded over 8% as liquidation pressure gradually subsided.
CryptoQuant analyst Amr Taha has spotted a significant open interest reduction in XRP’s derivatives market, indicating that Bybit saw over a third of its total liquidity withdrawn in the recent sell-off. The fall resulted in a significant number of traders that had leveraged losing their positions, as those that participated in Binance stayed in the market despite the market decline, Taha said.
Also Read: Bitcoin Drops Below Critical MVRV Level With $50K Zone in Sight
Bybit Open Interest Falls to Four-Month Low
On the other hand, Bybit’s XRP open interest fell to $181 million, the lowest it has been since February 13, according to Taha. This is a dramatic decline from the $283 million high on May 22. The effect was that the exchange saw a decrease in XRP open interest of about 36% in the span of less than three weeks. This fall suggests that a huge amount of leveraged positions were eliminated because they were either liquidated or withdrawn by traders.
Binance, on the other hand, had a different trend. Taha pointed out that Binance XRP open interest was close to $246 million as the local high of $252 million was recorded on June 2. As a result, Binance traders have managed to hold their positions in XRP even in its recent weakness. This disparity indicates that the leverage reset was not spread out across the entire derivatives market, but rather mostly focused on Bybit.
Furthermore, Binance continues to be the top XRP futures exchange in terms of trading volume. As a result, market players are keeping a close eye on the exchange for any indications that traders will keep their positions or start cutting down their risks.
Long Liquidations Dominate Market Activity
Liquidation numbers also shed light on the pressure experienced by bulls during the sell-off. Taha said that the number of individuals experiencing several long liquidation events topped $3.5 million, and some were close to $5 million. The selling pressure of those liquidations did not help, because leveraged positions were automatically liquidated. Short liquidations, in contrast, were relatively small during the fall.
Binance has about $1.85 billion worth of XRP futures trading volumes on June 5. Bybit’s next largest market cap was $727 million with OKX at $429 million and Bitget at $423 million. The total volume of combined futures at the four exchanges was slightly less than $3.43 billion. Binance accounted for a significant portion of the activity, with about 54% of it showing its dominance in the XRP derivatives market.
XRP Rebounds as Liquidation Pressure Eases
However XRP found some solace with the liquidation wave in the middle, as it bounced off its local bottom. The asset bounced back to the price of more than $1.14, just over 8% increase, when it was trading around the price of $1.055. The recovery would seem to indicate that forced liquidations played a big part in the down trend. When the pressure of liquidation abated, buyers came back and brought the market back under control.
Also, the drop-off in sales indicates it could have been just a blip in demand – not a true sign that sales were decreasing. When it comes to Binance positioning, it’s pretty much in the same range as it was recently, and Bybit has already undergone a major reset. To conclude, Taha’s analysis reveals that a series of long liquidation events took a toll on Bybit’s open interest, wiping away over one-third of the volume. Meanwhile, traders on Binance exchange were forced to sit on the sidelines and the exchange is expected to be at the heart of the next event in the market.
Also Read: Spacecoin Sets $100M Revenue Goal in Exclusive Vietnam Telecom Deal
