XRP Nears $3 Amid ETF Approval Speculation; $3.60 Target in Sight?

XRP Price Approaches $3 on ETF Approval Optimism

XRP’s price climbed to $3.04, marking its highest level in nearly two weeks, propelled by growing speculation around a possible exchange-traded fund (ETF) approval in the United States. This surge was accompanied by a notable increase in institutional participation, particularly in XRP futures markets, which has raised expectations that the cryptocurrency could revisit the $3.60 level observed in July.

Institutional Interest Evident in Futures Market

Data from CoinGlass indicates that demand for XRP futures increased by 5% month-over-month, reaching an aggregate open interest of 2.69 billion XRP, equivalent to approximately $7.91 billion at current prices. More significantly, the number of XRP futures contracts on the Chicago Mercantile Exchange (CME) surged by 74% over the same period, totaling 386 million XRP contracts. This sharp rise points to heightened activity from professional fund managers and market makers.

While elevated futures activity signals strong interest, it is important to note that long and short positions typically balance out. XRP monthly futures currently trade at a 7% premium over spot prices, consistent with the 5% to 10% premium range under neutral market conditions. This suggests leverage demand remains balanced despite increased trading volume.

XRP Underperforms Relative to Broader Altcoin Market

Despite recent gains, XRP’s price performance has lagged behind the wider altcoin market. Since August, XRP’s price has remained largely flat, while the total altcoin market capitalization rose 14%. Notable altcoins such as Hyperliquid (HYPE), Solana (SOL), Cardano (ADA), and Ether (ETH) posted gains ranging from 18% to 32% over the same period. XRP’s momentum in August was primarily driven by the resolution of its prolonged legal dispute with the U.S. Securities and Exchange Commission (SEC).

ETF Approval Prospects and Market Positioning

Market optimism centers on the anticipated SEC decision regarding an XRP ETF, expected in late October. Bloomberg analysts assign a high probability—around 90% or more—to the ETF’s approval. Additionally, hybrid products combining ETF and exchange-traded note (ETN) structures, such as those modeled after Solana Staking (SSK), could potentially launch sooner without direct SEC approval.

Adoption Challenges and Competitive Landscape

Ripple’s stablecoin RLUSD recently surpassed $700 million in assets, yet nearly 90% of its supply exists on the Ethereum network, limiting direct demand on the XRP Ledger (XRPL). The stablecoin sector remains dominated by established players like Circle’s USDC and World Liberty’s USD1, which offer deeper liquidity and present significant competition.

Investor expectations that XRPL could become a key infrastructure for international payments, potentially supplanting SWIFT, or rapidly expand tokenization capabilities face hurdles. According to data from RWA.xyz, XRPL accounts for only 2% of outstanding Real World Assets, trailing smaller blockchains such as Avalanche, Stellar, and Aptos. Furthermore, XRPL’s total value locked (TVL) stands at roughly $100 million, underscoring its modest market penetration.

Outlook: $3.60 Target Faces Headwinds

While XRP’s advance toward $3.60 remains plausible, sustaining such momentum appears challenging given current adoption metrics and competitive pressures. Investors should monitor the upcoming SEC decision and developments in XRP futures activity to gauge future price trajectories.

Disclaimer: This article is for informational purposes only and does not constitute legal or investment advice. The opinions expressed are those of the author and do not necessarily reflect the views of Cointelegraph.