Ripple's $5 Sounds Increasing: Millions of Dollars Investment from Institutuions! - Coin Bulletin

Despite the recent pullback in Ripple price, derivative exchange data continues to sound the alarm for $5

In January, XRP, which reached 3.40 dollars, then fell 30% to 2.40 dollars. However, institutional investors continue to show great interest in option contracts that the price could exceed 5 dollars. According to Deribit data, which is generally preferred by institutional investors, there are currently the most open positions in 5-dollar call options on the exchange and the total value of these contracts reached 3.84 million dollars.

These high open positions do not necessarily indicate that investors believe XRP price will definitely rise. According to Lin Chen, Deribit's Head of Asia Business Development, most of these options are purchased with a 'covered call' protection strategy. This strategy allows investors to make additional profits by selling options at higher prices without selling their XRP assets.

This method is a commonly used strategy in traditional financial markets, allowing investors to generate additional returns from their existing assets. It is also frequently preferred in major cryptocurrencies such as Bitcoin and Ethereum. However, this strategy has a disadvantage: If the XRP price rises faster than expected, investors may have to sell at lower prices.