XRP Options Traders Stay Cautious Despite Positive Signs
Even though things are looking hopeful for XRP, some traders on the Deribit platform are still being careful. Recent data shows that many are betting on XRP going down in the short term, especially for options that expire on April 18.
The chart shows something called a “left-skewed IV curve,” which means more people are buying insurance (called puts) in case the price drops. These puts are most popular at the $1.50 price level, where the estimated price jump (implied volatility) is very high — as much as 160%.
However, the chart for farther out in the future, like for May 30, looks more balanced. This may mean that traders are only worried about short-term news, like changes in crypto regulations.
Spot ETF Decision Could Sway Traders
One big reason for this caution is the upcoming decision by the U.S. Securities and Exchange Commission (SEC) about Grayscale’s XRP spot ETF. The SEC needs to decide by May 22. Since this happens not long after the April options expire, traders might be worried about the decision and are preparing just in case it’s negative.
Interestingly, another company, Teucrium, recently released a 2x leveraged XRP ETF — a much riskier product. Experts believe that if the SEC is okay with that, they may not have a strong reason to reject a regular spot ETF. If the SEC blocks it, they could face legal action or criticism from the public.
Previously, Grayscale won a legal case that helped push the SEC to approve a spot Bitcoin ETF. This happened because the SEC had already approved Bitcoin futures ETFs that were almost identical in performance to the spot version, and the court did not accept the SEC’s explanation for not approving both.
How XRP Differs from Bitcoin
XRP has a different situation compared to Bitcoin. It doesn’t have a strong futures market, and much of its trading happens outside the U.S. Still, XRP’s presence on U.S. exchanges has recently grown to levels not seen since the SEC lawsuit started in 2020.
Meanwhile, another popular cryptocurrency, Solana, has been losing ground in U.S. markets. It now holds only 16% of the market share in the U.S., dropping from the 25–30% range it had back in 2022.
Market Strength Backs XRP
There’s more good news for XRP, though. Its overall market position is stronger. Among altcoins, XRP has the deepest market in U.S. exchanges. This means it’s easier to trade without changing the price much. It’s even doing better than competitors like Solana and Cardano.
This strength comes with some big leadership changes at the SEC. Paul Atkins has taken over as the new SEC Chairman after Gary Gensler stepped down. Atkins is known to be more open to crypto and market-friendly rules, which could increase the chances of positive outcomes for XRP and other crypto ETFs.
Disclaimer: This article is for information only. It is not financial advice. Always do your research before investing. The information shared here may include opinions and does not necessarily reflect the view of the publisher.
