An unusual pattern is emerging in the XRP market, with rising prices and bearish bets continuing at the same time. Prices are extending a rebound, but derivatives markets have remained dominated by expectations of declines for a prolonged period. Analysts say a pattern similar to the run-up just before a past bull market is taking shape.

The Crypto Basic, a blockchain outlet, reported on Sunday that XRP funding rates have stayed in negative territory since February 2026. Funding rates are generally an indicator of whether long (buy) or short (sell) positions are dominant in the futures market. A negative rate means shorts account for a larger share.

This time, market sentiment and price moves are diverging. Darkfost, a verified CryptoQuant analyst, said in a recent market commentary that it is important that bearish positions remain dominant despite rising prices.

XRP fell to $1.1 in early February and has rebounded about 27 percent since then. Over the same period, funding rates have not turned positive even once. On Binance, XRP’s 30-day funding rate posted its longest negative stretch, according to the report.

The trend also coincides with a recovery in the broader altcoin market. The TOTAL3 index, which tracks the market value of cryptocurrencies excluding bitcoin, ether and stablecoins, at one point fell by more than $544 billion amid rising global uncertainty. It later showed a recovery as about $125 billion flowed back in.

Still, investors in XRP derivatives markets remain cautious. Darkfost said many traders still see a high likelihood of further declines, adding that such extreme bearish sentiment could instead be a sign of a bullish reversal.

Market participants are also focusing on how the current situation resembles last year. In April 2025, when XRP traded around $1.25 after a sharp drop, funding rates turned negative for the first time in about 16 months. Prices then rebounded, but funding rates stayed below zero for some time.

At that time, the recovery continued and upward momentum built. By the time funding rates belatedly turned positive, XRP had already entered a strong uptrend. XRP then jumped about 126 percent in July 2025, rising to a record high of $3.6.

Darkfost said the current market shows a similar structure. He said that if market participants crowd into bearish positions in the same direction after a drop of more than 60 percent, it could be a sign that a bullish turn is near.

As a result, attention is shifting from whether funding rates reverse to whether actual inflows and the price recovery can be sustained. Analysts say that if sentiment remains bearish but prices and altcoin fund flows keep recovering, a strong upswing similar to the past could unfold again.