Ripple (XRP) token crashed to a low of .4335 on Wednesday as its daily trading volume and futures open interest tumbled.
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XRP has now moved into the distribution phase, which is characterized by high volatility. If the theory works out well, it will now move into the markdown phase, which may see it drop to the support at CoinGlass data shows that futures open interest dropped to .45 billion on Wednesday, down from .45 billion in January. This is a sign that investor demand has dropped in the past few weeks. The daily XRP volume has dropped to billion from over billion a week ago.
Several catalysts may push the XRP price higher in the coming months. Polymarket’s odds of a spot Ripple ETF have jumped to over 80%. According to JPMorgan, spot XRP ETFs may experience over billion in inflows in the first year. This would be notable since spot Ethereum ETFs have accumulated just billion in inflows.
XRP price chart | Source: crypto.news
The bearish view will become invalid if the Ripple price rises above the year-to-date high of .40.
It then moved into the markup phase in November as its price surged, leading to Fear of Missing Out among investors. This phase has higher demand than supply.
XRP price may be at risk of a deep dive
Ripple also received a money transmitter license in New York and Texas, allowing it to operate its services in these two major US states.
The XRP price has suffered a harsh reversal this month, moving into a bear market after falling by almost 30% from its highest level in January.
Ripple Labs has continued to ink deals that will help it become a leading player in the financial services industry. For example, it has partnered with Unicambio, a Portuguese currency exchange provider that will use its network for currency transactions.
