Ripple has highlighted a few reasons why XRP is a preferred base currency for arbitrage trading among the thousands of digital currencies in the cryptocurrency market.
In a blog post, Ripple says XRP stands out among its counterparts during this COVID-19 and beyond. The blockchain firm says XRP is better-referred to as a safe haven asset as the impact of COVID-19 confirms the label.
Low Transaction Fees and Fast Network
Ripple says during the “Black Thursday”, both Bitcoin and Ethereum saw five times their usual daily transaction, resulting in congestions on their networks.
Par previous analysis, there was a great indication that users of Ethereum and Bitcoin shifted to XRP digital currency during this period, for exchange balance transfers. The finding was first dug out by Xpring.
The reasons Ethereum and Bitcoin users shifted to XRP during this period were not farfetched. One, XRP transaction fees are very low, and transactions on the network are reliable and speedy.
The above are also characteristics looked out for by market makers and traders as it makes them take “advantage of arbitrage opportunities intra-exchange” no matter the period.
Ripple believes traders and market makers make use of XRP to speedily manage risk or collateral and as well as service margin calls.
Market makers and traders need assets that will move quickly to enable them to capture price differences on different exchanges, this, XRP does without any issue. More than 130 exchanges that have listed XRP confirm this unique functionally of the XRP network, Ripple says in the update.
Bitrue CEO’s Statement on XRP
Recently, Bitrue CEO Curis Wang mentioned that the company focuses on XRP because it makes them grow. Bitrue says it is now benefiting from centering the platform on XRP alone.
Another thing that makes XRP ideal for arbitrage trading is that the speed of XRP lowers the necessity for liquidity providers to have an enormous inventory of digital assets at different exchanges, thereby reducing their capital needs. Through the fast XRP transaction speed, the hacking risk is mitigate