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The shorts that retreated from the XRP Bitwise XRP ETF just days ago have returned with force, pushing the fund back into the same territory that defined last month's squeeze episode.
The turnaround in short interest is the story of this week. The previous note, published September 30, described a dramatic cover: short interest had collapsed from 14.4% of the free float on September 22 down to roughly 4% by September 29. That cover has now fully reversed. Short interest climbed back to 15.8% of the free float by October 6, a rise of 244% over the past week and 19% in the single session ending October 6 alone. The ORTEX short score has tracked the rebuild, climbing from a low of 29 in late September to 47.6 now, back near the levels that prevailed at the peak of last month's episode. The shorts left, but they came back.
The borrow market tells a more complicated story than the headline short interest figure suggests. Availability has tightened sharply over the past week, falling from over 2,000% to 204%, meaning roughly two shares now remain in the lending pool for every one borrowed. That is a significant tightening in a short period. Yet the 52-week low for availability was 5.7%, so the market is nowhere near a genuine squeeze pinch point. Cost to borrow has also moved in the opposite direction from short interest, easing to 1.84% from above 2% a week ago and well below the 4.5% levels seen in late August. Borrow is getting harder to find, but it is not yet expensive.
Options positioning adds a layer of caution to the picture. The put/call ratio has risen to 0.27, above its 20-day average of 0.21 and about one standard deviation above the mean. That is not extreme by any measure, the 52-week high is 0.33, but the directional shift is notable. Through most of August and early September the ratio ran below 0.18. The move toward a higher put/call reading since late September broadly coincides with the short interest rebuild, suggesting some participants are layering on downside protection rather than purely using the short market.
The fund itself has climbed 7.3% over the past month and gained 0.6% over the past week to close at $16.79, though it gave back a fraction on October 6. The tension worth watching now is whether this renewed short build has more conviction than the September episode, which unwound within five sessions, or whether the falling cost to borrow suggests shorts are finding the trade less competitive than it was a month ago. The next meaningful read will come from whether availability continues to tighten toward the 50% threshold or stabilises as the lending pool adjusts to the new demand.
See the live data behind this article on ORTEX.
Open XRP on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data and reviewed by the ORTEX team. Content is informational only and does not constitute investment advice.
