In a remarkable turnaround, payments-focused cryptocurrency XRP is experiencing its most significant surge since January 2018, with futures open interest reaching unprecedented levels. Despite regulatory hurdles that previously hampered its price during the last bull run in 2020-2021, XRP is now on an accelerated upward trajectory.

This month, XRP's price has skyrocketed by 50%, hitting a seven-year high above $3, adding to a staggering 240% rally over the last quarter. Current data from CoinDesk outlines XRP's market capitalization, which stands at an impressive $176.75 billion, securing its place as the third-largest cryptocurrency, trailing only behind the stablecoin Tether.

The speed at which XRP is moving has drawn attention, with many analysts noting that its relative strength index (RSI) has climbed to a stunning 92—its highest level since October 2017. The RSI is a tool used to gauge the velocity and change of price movements, typically assessed over a timeframe of 14 days or 12 months. While a reading above 70 can indicate overbought conditions, historical data suggests that such moments do not automatically correlate with imminent corrections.

“Despite the potential for overbought signals, XRP and the broader crypto market show no significant signs of slowing down,” noted Diego Cardenas, an OTC trader at the digital asset platform Abra. He highlighted the reclamation of XRP's third position in the cryptocurrency hierarchy, as well as significant corporate developments, including a growing number of partnerships and the anticipated launch of Ripple’s stablecoin, RLUSD.

Analysts believe that this surge is not just a flash in the pan. With trading volumes in the spot market increasing to over $23 billion in the last 24 hours and derivative volumes more than doubling to $34 billion, the momentum supports the ongoing bullish trend. XRP's perpetual futures open interest peaked at a staggering 2.34 billion XRP, with funding rates—a measure of the cost of holding leveraged positions—hovering around 13%. This indicates a healthier market in comparison to the excessive leverage seen in early December when rates reached an unsustainable 100%.

Additionally, XRP is riding on the broader wave of bullish sentiment across the cryptocurrency landscape, particularly as Bitcoin recently broke past the $100,000 mark—the first time in history—bolstered by positive macroeconomic indicators stemming from a slowdown in U.S. core inflation.

With a favorable market environment, XRP appears poised for continued growth. Investors and analysts alike are keeping a close eye on these developments, speculating on the future trajectories of both XRP and the wider cryptocurrency market. The question remains: how high can XRP go before facing its next test?