Woofun AI reports that a major volatility play emerged in the XRP options market, attributed to a trader executing a long straddle on Deribit. This trade, identified by derivatives analytics firm Laevitas, involves simultaneous purchases of call and put contracts at the $1.16 strike level, positioning for substantial price movement rather than directional bias.

The position comprises 2 million contracts, totaling a $2.32 million notional value, with the trader paying approximately $62,000 in premium.

Woofun AI data shows the trade is set for expiration on August 28, specifically labeled as 28AUG26 in market records. This structure ensures that profit is realized only if the underlying asset moves significantly away from the strike price, covering the initial cost.

Market context reveals a sharp sentiment shift, as XRP jumped nearly 15% to $1.34 on Thursday before settling around $1.26. This rally contrasts with earlier quarter trends where traders favored short straddles to collect premiums during range-bound activity. The recent surge in open interest and buy volume at the $1.16 strike on Deribit underscores this pivot toward expecting high volatility by Aug. 28.

Mechanically, the strategy relies on the call option providing upside exposure while the put option offers protection against declines. If XRP stays flat near $1.16, both options lose value, resulting in a total loss of the $62,000 premium paid. This marks a decisive bet that the recent momentum will continue or reverse sharply before expiration.