Ripple (XRP) is showing a rare divergence in the derivatives market: funding rates have remained negative for nearly three consecutive months, while the token’s price has recovered approximately 27% since the sharp correction in early February.
In a context where many altcoins are still struggling after the deep plunge at the beginning of the year, data from CryptoQuant shows that many futures traders are still leaning toward a scenario where XRP drops back down, despite the token’s significant recovery since February.
Negative Funding Still Dominates XRP Futures
According to CryptoQuant data, XRP has increased by about 27% since the correction zone in early February. According to analyst Darkfost, 30-day aggregated funding rates on Binance have remained in a bearish state almost continuously for 3 months, marking one of the longest periods of negative funding for XRP in recent times.
📉 During this correction, driven by an uncertain global backdrop, the altcoin sector was the first to suffer the consequences.
As a result, the Total3 index, which represents the crypto market cap excluding $BTC, $ETH, and stablecoins, lost more than $544B.
However, the… pic.twitter.com/JZToj19FmI
— Darkfost (@Darkfost_Coc) May 9, 2026
The fact that funding rates continue to sit below the neutral zone indicates that the market has not yet fully shifted to a bullish positioning for XRP.
According to Darkfost, the market currently maintains a defensive sentiment following the altcoin correction early in the year. During the same period, the Total3 index—representing the total crypto market capitalization excluding Bitcoin, Ethereum, and stablecoins—lost more than $544 billion before recovering about $125 billion since early February.
Many futures traders seem to still view the current recovery as a temporary rebound rather than a more sustainable uptrend.
XRP Price Has Been Moving Higher Anyway
TradingView data shows that XRP bounced strongly from the bottom area around $1.12 during the sell-off in early February and maintained a sideway-to-up structure for several weeks thereafter.
XRP price chart (D). Source: TradingView
During most of March and April, XRP fluctuated in the range of approximately $1.30–$1.50 instead of returning to the old lows. By early May, the price continued to recover toward $1.48 before correcting slightly back to the $1.42–$1.43 range at the time of writing.
Although this recovery is not yet enough to confirm a larger macro breakout, current price action is moving contrary to the positioning of many futures traders.
The fact that funding rates remain negative while XRP holds a higher price range compared to the February bottom suggests that bearish pressure in the futures market is insufficient to drag the price back into the previous downtrend. This is also why the market is beginning to monitor the possibility of a short squeeze if XRP can overcome key resistance levels above.
Darkfost also noted that a similar funding pattern appeared in April 2025, when XRP was trading around the $1.25 zone before entering a rally of over 126% afterward. However, current price action remains significantly more cautious and has not yet shown strong expansion momentum like the previous period.
Derivatives Activity Is Still Heavily Elevated
Data from CoinGlass shows that XRP’s 24-hour futures volume is currently around $3.79 billion, significantly higher than the spot volume of approximately $682 million. Open interest also remains around $2.89 billion, indicating that the amount of capital active in the perpetual futures market remains high.
XRP derivatives overview. Source: CoinGlass
The large gap between futures volume and spot volume suggests that the majority of current trading activity is driven by speculative positioning rather than pure spot demand.
Interestingly, while aggregated funding still leans bearish, long/short ratio data on Binance and OKX shows that retail accounts tend to hold more long positions than shorts on shorter timeframes.
However, overall funding rates remain in the negative zone, showing that the market has not shifted to an over-bullish state as seen in previous strong rallies.
Resistance Levels Now Matter More Than Funding
Although funding rates are creating a more positive signal for XRP, the market still needs price confirmation before expecting a larger breakout.
The $1.50–$1.55 zone is currently the nearest resistance that XRP has surpassed several times but failed to maintain upward momentum in recent months. Meanwhile, the $1.80 zone continues to be closely watched by the market as it was a key support before the sharp drop in February.
If XRP can close daily candles stably above these zones while funding remains low or negative, the market could begin to see increased pressure on open short positions in perpetual futures.
Conversely, if XRP continues to be rejected at resistance and returns below the $1.35–$1.40 range, the current bearish positioning will likely be seen by the market as justified.
Another factor to watch is whether open interest increases along with a breakout. In many cases, a price increase accompanied by a decrease in OI often reflects short covering rather than new capital actually entering the market.
Why Traders Are Still Reluctant to Turn Bullish
Prolonged negative funding rates show that the market has not yet completely escaped defensive sentiment following the period of altcoin volatility early in the year.
For XRP, this is also related to the fact that the token has spent many months moving sideways after losing momentum from its early 2026 peak. Although Ripple concluded its long-running lawsuit with the SEC last year, XRP has not yet created a narrative strong enough to draw capital back in the way it did during previous bull phases.
If funding rates turn positive too quickly while the price has not yet clearly broken out, it could indicate that bullish sentiment is heating up prematurely. But if XRP continues to maintain a structure of higher lows while futures market positioning remains cautious, the market may begin to closely monitor the possibility of a larger short squeeze in the coming weeks.
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