XRP ETF Shorts Stay Minimal as Borrow Market Loosens Further

The Bitwise XRP ETF's now-familiar short-cycle pattern has reached another trough, with positioning lighter than at any point in the past month and the borrow market wide open.

Short interest has continued its retreat since the October 14 note documented the collapse from the October 7 peak. It now stands at 0.73% of the free float, down another 56% on the week. The absolute share count is tiny: 44,214 shares short against a fund with well over six million shares available to borrow. There is nothing in this number that warrants treating it as a primary signal. What is worth noting is the persistence of the cycle: shorts built sharply in early October, peaked around October 7 at what the previous note put at 15.8% of float, then collapsed, briefly rebuilt to a smaller local peak in mid-October, and have now retreated again. The pattern has repeated three times in roughly six weeks.

The borrow market has followed that cover with a dramatic loosening. Availability is now 3,378%, meaning roughly 34 shares are available to borrow for every one currently lent out. That is a sharp reversal from the tightest point in the recent cycle: on October 6, availability had compressed to 204%, and in late September it briefly touched 147%. The 52-week tightest reading was 5.7%, which gives a sense of how far the market sat from genuine stress even at the recent peak. Cost to borrow has also drifted lower, now just above 1%, down 37% on the week and more than halved from a month ago. Borrow conditions could hardly be described as restrictive.

Options positioning is calm and mildly bullish in tone. The put/call ratio sits at 0.28, barely above its 20-day average of 0.27 and less than a quarter of a standard deviation from the mean. The ratio touched 0.33 on October 16, its highest reading in the past year, but pulled back immediately. With calls heavily outnumbering puts throughout the history available, options traders in this fund have consistently leaned toward upside exposure rather than downside protection.

The combined ORTEX score of 26.7 is on the weaker side of the range, consistent with a fund that has had a difficult month on price, down 6% over the past 30 days and off another 3.2% on the week despite a 2.1% bounce on October 20. The ETF tracks XRP directly, so its price story is entirely the XRP story: regulatory news around Ripple and broader crypto sentiment remain the variables that matter, not anything specific to the fund's structure or positioning.

What to watch is whether shorts attempt another rebuild from this trough, as they have twice before over the past six weeks, or whether the pattern breaks and positioning stays flat into the next significant XRP catalyst.