Ripple (XRP) price plunged 5.2% in the past 24 hours to trade at $2.31 on Saturday

Ripple (XRP) fell behind the broader crypto rally on Friday, weighed down by macro turbulence and fresh sector-specific risks.

Despite a stellar Friday that saw Donald Trump’s 50% tariff threat on the EU spark institutional demand for Bitcoin, (BTC) to record highs, and crypto exchange deposits hit 16-month highs, crypto prices are starting the weekend in the red.

Bitcoin price slid below the $108,000 key level on Saturday, with BTC price now down 4.6% over 24 hours to trade at $107,388.55 at the time of press.

However, is the bull market over yet? Not quite. According to Coinshares data, Bitcoin’s price smash to new all-time highs (ATHs) of $111,807 was also driven by $934 million in daily ETF inflows.

This is the second-highest daily total since Coinshares began tracking crypto products in January 2023.

But while BTC price slid despite the stellar macro backdrop and record institutional demand, the main takeaway was that short-term traders were rapidly closing out positions.

Indeed, derivatives data shows a 1.47% decrease in XRP open interest to $4.89 billion.

This comes as traders quickly booked profits on Friday’s price swings, capitalising on the 56.6% price increase in Bitcoin price since mid-March.

Its price is now up 5.2%, making it the worst-performing top-five asset by market cap. In comparison, BTC, ETH, SOL, and BNB all posted daily timeframe losses that were capped below 5% at the time of publication.

Why Is XRP Price Down Today?

The decline in XRP price comes amid increasing concerns about Ripple’s ability to compete in the global stablecoin market, especially after JPMorgan (NYSE:JPM) is leading a group of four legacy banks in the creation of a new Wall Street-native digital dollar project.

According to the Wall Street Journal, the largest U.S. banks—JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo—are in the planning stages of launching a joint USD-backed stablecoin.

This initiative will reportedly leverage the infrastructure of premier blockchain providers, including Early Warning Services and The Clearing House, to facilitate faster payments and seamless cross-border transactions.

However, this move could see Wall Street institutions claim a larger share of the market from existing stablecoins launched by crypto firms.

Earlier this year, Ripple launched its own U.S. dollar-backed stablecoin, named “RLUSD,” on both the XRP Ledger and Ethereum.

Backed 1:1 by U.S. dollar reserves and short-term treasuries, RLUSD serves as the payment and liquidity backbone for RippleNet and its On-Demand Liquidity (ODL) product suite, which are used by institutional players.

At the time of publication on May 24, Ripple’s native stablecoin now has a circulating capital of $310 million, according to the latest RLUSD data from CoinGecko.

But the emergence of a “Wall Street stablecoin” backed by the top four U.S. banks threatens to diminish RLUSD’s rapidly growing market dominance, especially among institutional players.

What’s Next For XRP Price Action As Open Interest Dips Below $5B?

The 24-hour liquidations data from Coinglass also highlights the strong bear momentum, with $14.88 million in XRP longs liquidated and $1.02 million in shorts liquidated from the $15.89 million total positions closed.

The 12-hour window alone saw $5.02 million in long positions liquidated. This suggests that a majority of the recent sell pressure came from long traders getting caught off guard by the JPMorgan news.

If XRP’s open interest continues to decline toward $4.5 billion, we could see the spot price action testing key support levels at $2.20 and $2.10.

On the upside, Bitcoin’s current consolidation above $108,000 provides a favorable macro backdrop. If XRP price manages to stabilize above $2.30 over the weekend, Bitcoin’s steady consolidation above $108,000 could offer a technical buffer for XRP bulls in the near term.

Technically, a recovery toward $2.45 seems possible if XRP manages to hold the $2.20 support and derivatives open interest manages to reclaim the $5 billion level.

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