How to hedge XRP

XRP is XRP token.

As XRP is a volatile asset, in certain instances it will require hedging.

The best method of hedging XRP is to use crypto derivatives.
There are multiple of the exchanges serving futures and perpetual swaps.

Choose from the list of hedging options

XRP Futures

When required to hedge the position for the mid-term period (weeks to months) you can use futures.

Exchange Symbol Premium (-)
Discount (+)
Spread Open Intrest 24h Volume Expiry Date
BTCC Futures XRP-QUARTERLY 0.043 0.48 0 34,924,058 31/3/2023
OKX (Futures) XRP-USDT-230331 0.020 0.03 4,795 3,946,378 31/3/2023
OKX (Futures) XRP-USDT-230407 -0.345 0.06 439 2,449,347 7/4/2023
OKX (Futures) XRP-USDT-230929 -1.143 0.04 1,886 2,432,684 29/9/2023
OKX (Futures) XRP-USDT-230630 -0.661 0.06 5,160 2,367,938 30/6/2023
Binance (Futures) XRPUSD_230331 -0.033 0.02 587,900 1,145,148 31/3/2023
OKX (Futures) XRP-USD-230929 -1.109 0.04 564,960 1,066,384 29/9/2023
OKX (Futures) XRP-USD-230407 -0.129 0.04 66,070 779,253 7/4/2023
OKX (Futures) XRP-USD-230331 -0.013 0.05 421,520 748,422 31/3/2023
OKX (Futures) XRP-USD-230630 -0.200 0.08 1,589,280 726,571 30/6/2023
Binance (Futures) XRPUSD_230630 -0.631 0.02 1,872,250 685,889 30/6/2023

XRP Perpetual Swaps

Short position for indefinite time is also possible by using perpetual.
Moreover you can earn swaps in particular cases.

Exchange Symbol Premium (-)
Discount (+)
Spread Funding Rate Open Intrest 24h Volume
C-Trade XRPUSDT -0.141 0.04 0.01000 249,525,838 6,660,037
Binance (Futures) XRPUSDT 0.015 0.02 -0.00644 193,825,365 1,144,918,703
Bitrue (Futures) XRP-USDT 0.224 0.02 -0.00662 146,111,299 402,847,374
Bybit (Futures) XRPUSDT 0.000 0.02 0.00530 116,317,295 238,481,235
BingX (Futures) XRP-USDT 0.098 0.01 0.03790 77,729,556 160,403,877
Bybit (Futures) XRPUSD -0.156 0.02 0.06140 55,590,596 59,865,963
Bybit XRPUSD 0.089 0.03 -0.07580 46,632,043 75,195,130
Bybit XRPUSDT 0.059 0.03 -0.04920 36,833,865 75,852,151
FTX (Derivatives) XRP-PERP 1.660 0.61 -2.94000 29,204,183 206,317,908
Gate.io (Futures) XRP_USDT 0.045 20.00 0.00540 28,277,396 20,915,748
ZBG Futures XRP_USDT -0.065 0.19 0.01000 23,028,715 4,646,661
Binance (Futures) XRPUSD_PERP 0.034 0.02 -0.00441 21,807,560 129,408,030
Prime XBT XRP/USD 0.000 0.22 0.00000 17,040,900 156,756
AAX Futures XRPUSDTFP 0.684 9.52 -0.01056 12,450,157 47,426,125
Bitget Futures CMT_XRPUSDT -0.026 0.07 -0.00459 11,812,686 50,683,965
Phemex (Futures) XRPUSD 0.067 0.02 0.00263 11,021,302 169,694,025
Hopex XRPUSDT 0.049 0.00 0.00000 10,815,018 33,104,115
Prime XBT XRP/BTC 0.000 5.88 0.00000 10,601,000 3,520
Bitforex (Futures) SWAP-USD-XRP 0.074 0.22 -0.02620 9,468,874 69,456,524
OKEx (Futures) XRP-USDT-SWAP -0.017 0.05 -0.01923 9,264,748 56,737,392
MEXC Global (Futures) XRP_USDT 0.067 0.02 0.00450 8,039,483 117,813,946
BitZ (Futures) 104 0.016 0.17 0.00000 6,801,657 107,361,215
OKEx (Futures) XRP-USD-SWAP 0.081 0.06 -0.02160 6,399,920 30,361,988
BitMEX XRPUSD -0.119 0.02 0.01000 4,437,237 3,161,817
Huobi Futures XRP-USDT 0.090 2.22 0.01000 3,646,552 9,089,235
Phemex XRPUSD -0.066 0.16 0.01000 2,697,170 18,080,031
MXC (Futures) XRP_USDT -0.026 0.12 0.00000 2,514,230 2,224,183
Binance (Futures) XRPBUSD 0.023 0.02 -0.01691 2,194,543 96,882,383
WhiteBIT Futures XRP_PERP 0.132 0.07 0.01000 1,956,437 69,586
Bybit (Futures) XRPPERP 0.045 0.04 -0.02600 1,571,708 197,021
BTSE (Futures) XRPPFC 0.602 0.18 0.00000 1,251,021 1,604,341
Kraken (Futures) PI_XRPUSD 0.067 0.07 -10.80530 1,225,982 2,642,795
Bitget Futures XRPUSD 0.000 0.06 -0.09975 1,093,603 2,391,539
Bitfinex (Futures) XRPF0:USTF0 -0.011 0.02 0.00000 981,571 810,219
CoinEx (Futures) XRP-USDT -0.045 0.02 -0.00391 586,527 5,397,036
Huobi Futures XRP-USD -0.137 2.22 0.05485 455,540 752,432
BitZ (Futures) XRP_USDT 0.000 0.23 0.00000 338,754 1,975,274
WOO Network (Futures) PERP_XRP_USDT 0.070 0.08 -0.00101 209,693 348,570
Deribit XRP_USDC-PERPETUAL 0.200 0.02 0.03540 194,773 30,586
BaseFEX XRPXBT 1.353 3.07 0.01000 97,774 975,600
Crypto.com Exchange (Futures) XRPUSD-PERP 0.080 0.11 -0.00176 93,558 932,450
WOO X (Futures) PERP_XRP_USDT -0.042 0.07 -0.00081 74,047 521,103
HitBTC (Derivatives) XRPUSDT_PERP 0.089 0.07 0.01000 70,145 902,934
AscendEX (BitMax) (Futures) XRP-PERP 0.058 0.00 -0.02505 40,914 47,536
ZB (Derivatives) XRP_USDT -0.052 0.16 0.01000 36,026 37,576,537
MEXC Global (Futures) XRP_USD -0.067 0.02 0.00070 27,652 52,501,937
Gate.io (Futures) XRP_USD -5.704 60.00 0.01000 7,064 85
CoinFLEX (Futures) XRP-USD-SWAP-LIN -1.292 2.03 0.00000 5,349 1
Bit.com (Futures) XRP-USDT-PERPETUAL -0.026 0.38 0.00000 364 276
MXC (Futures) XRP_USD -0.067 0.47 -0.04430 0 1,268,353,797
BTCEX (Futures) XRP-USDT-PERPETUAL 0.089 0.04 -0.00720 0 597,031,842
Bitmart Futures XRPUSDT 0.024 0.07 0.03000 0 412,831,410
CoinTiger (Futures) XRPUSDT 0.048 0.02 -0.00578 0 355,567,240
Deepcoin (Derivatives) XRPUSDT 0.023 0.05 0.02171 0 317,551,637
BTCC Futures XRPUSDT -0.024 0.35 0.00000 0 79,576,764
Biki (Futures) 8 -0.062 0.32 0.10041 0 52,805,491
XT.COM (Derivatives) XRP_USD 0.134 0.00 -0.08820 0 37,432,330
Deepcoin (Derivatives) XRPUSD 0.035 0.18 0.02357 0 25,439,234
GMO Japan (Futures) XRP_JPY 0.000 0.07 0.00000 0 17,716,993
XT.COM (Derivatives) XRP_USDT 0.156 0.00 -0.02470 0 15,779,670
CoinTR Pro (Derivatives) XRPUSDT 0.022 0.00 0.01000 0 14,718,118
MyCoinStory XRPUSDT_QUANTO_PERP -0.281 0.00 0.18486 0 7,725,393
BIT (Futures) USD-M:XRP-USD-PERPETUAL -0.066 0.36 -0.03204 0 6,098,613
Bit.com (Futures) USD-M:XRP-USD-PERPETUAL 0.593 0.14 -0.00815 0 5,972,673
Stormgain Futures XRP-PERPUSDT 0.000 0.08 0.00400 0 5,042,994
Fairdesk Derivatives XRP-USDT-PERP 0.089 -2.54 -0.07740 0 3,207,054
HBTC (Futures) XRP-SWAP-USDT -0.012 0.11 -0.01304 0 2,388,540
Delta Exchange XRPUSDT -0.373 0.02 0.19170 0 1,474,953
Delta Exchange XRPBTC 0.518 0.62 0.01000 0 1,469,094
HBTC (Futures) XRP-SWAP -0.063 0.01 0.02477 0 150,176
BHEX (Futures) XRP-SWAP-USDT 0.021 0.15 0.01808 0 53,656
Crypto.com (Futures) XRPUSD-PERP 0.000 0.18 0.00000 0 50,173
Bitfinex (Futures) XRPF0:BTCF0 -0.036 0.06 -0.01357 0 48,559
BHEX (Futures) XRP-SWAP 0.012 0.02 0.02784 0 45,604
MEXC Global (Futures) XRP_MUSDT -0.163 94.73 0.00000 0 42,862
Bibox (Futures) 4XRP_USDT 0.000 0.03 0.00000 0 12,496
MCS XRPUSDT_QUANTO_PERP -0.804 0.10 0.01000 0 98
Drift Protocol XRP-PERP 0.000 0.00 0.06224 0 0

Future Contracts on Indexes with XRP embeded

Another way of hedging positions for the mid-term is using future contracts on indexes with the asset price as a component of the the index.

Unfortunatelly, no future contract on index consisting of XRP exists.

Perpetual Swaps on Indexes with XRP component

Sometime the best option to hedge XRP is to short with perpetual contract idefinitely.
Earning swaps can be in some cases crucial for the positioning.

Exchange Symbol Premium (-)
Discount (+)
Spread Funding Rate Open Intrest 24h Volume
FTX (Derivatives) ALT-PERP -9.888 0.60 10.36560 5,825,356 8,460,075
MEXC Global (Futures) ALT_USDT -0.417 0.42 0.10000 88,363 1,997,970
Gate.io (Futures) ALT_USDT -0.060 18.68 0.01000 7 2,265
BTSE (Futures) BBAXPFC -0.277 0.41 0.00000 0 186,125

Other crypto related Indexes (Perpetual Swaps)

There are several specyfic cryptocurrencies market Indexes which can be considered as a hedge for the trading positions. As Bitcoin take the lion's share of the whole market capitalisation, BTC dominance is one of the most notable.
Even more than on other markets, Bitcoin volatility influences almost all the trading pairs traded with both BTC and altcoins at the same moment.

Exchange Symbol Premium (-)
Discount (+)
Spread Funding Rate Open Intrest 24h Volume
BingX (Futures) BTCDOM-USDT -0.010 0.01 -0.01020 1,288,724 1,856,212
Bitfinex (Futures) BTCDOMF0:USTF0 0.020 0.04 0.00000 305,005 756
Bitfinex (Futures) TBTCDOMF0:USTF0 0.060 0.17 -0.11774 163,844 109,181
Binance (Futures) BTCDOMUSDT 0.123 0.02 0.01000 11,161 6,673,503
BTSE (Futures) BDIPFC -0.143 0.30 0.00000 2,482 41,193
BTSE (Futures) BTCDOMPFC 0.252 0.16 0.00000 0 121,499

Negative correlation with XRP

It can be an awkward exercise to find liquid, negatively correlated altcoins in the cryptocurrency market.

The strongest negatively correlated crypto tokens (returns in USD) in a long term are:

XAUT KNC
XRP -0.01 -0.00

Check correlations with XRP or use a custom form to check XRP changes in correlation coefficient with other token.

Stable coins or non-crypto assets can also be considered for hedging positions.