Ripple’s 1Q report “Total XRP sales increased by more than 10 billion yen”

1Q XRP Market Report

On the 27th, Ripple released a market report for the crypto asset (virtual currency) XRP in the first quarter (January to March) of 2023. The main points to note are:

• Total XRP sales totaled $360 million (up $130 million year-on-year)
• Increased on-chain activity on the XRP ledger (XRPL)
• Proposing a new interoperability standard between blockchains
• European Union (EU), UK, United Arab Emirates (UAE) Create New Crypto Regulatory Regime

XRP sales volume

In the first quarter (1Q), Ripple’s total sales of XRP (XRP purchase amount minus sales amount) increased from approximately 30.8 billion yen (approximately $230 million) in 2022 4Q to approximately 48.2 billion yen (approximately 3.6 billion).

Ripple sells XRP in connection with its XRP-based payment solution “ODL” (on-demand liquidity). Source XRP from the open market to ensure a sufficient supply of XRP is available for ODL. Efforts are made to minimize the market impact of purchases.

According to the CryptoCompare TopTier (CCTT) index provided by cryptocurrency data company CryptoCompare, Ripple’s total sales in 1Q were equivalent to 0.44% of global XRP trading volume.

As for XRP held in escrow by Ripple, 3 billion XRP was unlocked in 1Q, in line with the official contract of 1 billion XRP per month. In addition, a total of 2.1 billion XRP was returned and again incorporated into the new escrow agreement.

On-chain activity on XRPL

In 1Q, on-chain activity on XRPL continued to be strong, with DeFi (decentralized finance) transaction volume up 34% compared to 4Q 2022, worth approximately ¥15.4 billion ($115 million) traded was done. The average daily trading volume (ADV) on centralized exchanges also increased by 46% to reach approximately ¥134 billion ($1 billion).

Ripple explained that NFTs (non-fungible tokens) continued to drive growth in transaction volume, especially in DeFi. More than 1 million NFTs have been minted on XRPL since October 2022, when they implemented the standard “XLS20” to streamline the creation of NFTs on XRPL.

connection: Virtual currency XRP economic zone, implementation of new NFT standard “XLS20” that can be issued without using a smartphone

New interoperability standards

Ripple also noted that its development team proposed a new standard (XLS38d) in February to enable interoperability between different blockchains.

It allows users to transfer cryptocurrencies and data between blockchains regardless of the underlying protocol or programming language. It is also possible to use XRPL together with other blockchains, and it is expected that the introduction of XRPL will progress.

Regulatory system to be developed

Regarding the state of the cryptocurrency market, Ripple notes positively that regulations are being put in place in countries such as the EU, the UK and the United Arab Emirates (UAE).

In the United States, the US Securities and Exchange Commission (SEC) pointed out that it is cracking down without showing clear guidelines. On the other hand, it is a form of evaluating the EU Parliament’s MiCA approval and the UK’s plan for comprehensive virtual currency regulation.

connection: The European Parliament approves the MiCA regulation, to unify EU-wide regulations on virtual currencies

connection: Summary of the “Ripple trial” filed by the US SEC (December 2020-April 23)

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