XRP's Leverage Reset to February Levels Following Federal Reserve Decision
02 May 2026 · 02:00 UTC · Bitcoinist RSS Feed · Original source
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Summary
XRP is struggling to maintain support above $1.35 following the Federal Reserve's April 29 decision, which triggered significant post-Fed deleveraging across cryptocurrency derivatives markets. CryptoQuant data indicates that cryptocurrency leverage has compressed to levels not seen since February, signaling rapid unwinding of leveraged positions. This deleveraging wave is creating measurable pressure on altcoin prices, particularly XRP. The reset of derivatives activity to early-year levels indicates ongoing liquidations as traders reduce risk exposure in response to the Fed's monetary policy announcement. The price action at $1.35 is identified as a critical juncture for XRP as the market absorbs systemic deleveraging.
Why it matters
The Fed's April 29 decision triggered a risk-off environment that prompted margin liquidations across crypto derivatives markets. The reset of leverage to February levels indicates substantial reduction in leveraged positions as traders cut exposure following tightening monetary policy. Deleveraging typically follows a predictable pattern: initial sharp downside from forced position closure, followed by eventual stabilization. Altcoins face disproportionate pressure due to higher average leverage ratios in retail trading and greater sensitivity to macro risk sentiment. The $1.35 XRP level represents a critical juncture where liquidation support or buyer defense is concentrated. Key uncertainties include deleveraging duration (could accelerate or stabilize rapidly), magnitude of remaining forced liquidations, and sentiment response to Fed forward guidance. Bitcoin's institutional ownership and superior liquidity provide natural downside support relative to leveraged altcoins.
Expected impact
The article highlights ongoing post-Fed deleveraging creating significant pressure on altcoins, particularly XRP. With derivatives activity compressed to February levels, leverage positions are being rapidly unwound, typically preceding short-term downward pressure. XRP's struggle to maintain $1.35 signals critical price levels where buyers are defending or sufficient liquidations have occurred. This deleveraging is more pronounced in altcoins than Bitcoin, as retail traders typically employ higher leverage ratios on alts and the asset class exhibits greater sensitivity to risk-off sentiment. The near-term outlook appears bearish as positions unwind, with potential stabilization once deleveraging completes. Bitcoin should experience less acute downward pressure due to its larger market depth and lower average leverage positioning.