This quarter has seen Ripple sell 900 Million XRP. The Tokens were worth about $251 Million.
In its market report for the previous quarter which saw a significant increase of an average daily volume of $429.51 Million as against $156.01 Million in Quarter 1, Ripple has shown some resilience due to its specific use case: Global Value Transfer.
This may sound like acceptance of the token by everyone but few issues need to be considered for it to be proven that this is “it” for the Cryptocurrency.
The Emergence of Other Competitors
Ripple isn’t the only Value transfer Blockchain developer who has a functional product.
JPM Coin which is backed in South East Asia by Mizuho Bank and 60 other partners offers similar functionality with XRP.
The only difference is that XRP has a secondary market while JPM coin deals primarily with retailing. As such, the emergence of new competitors into the value transfer market within the crypto sphere is a given.
It’s how the guys at ripple headquarters handle it that will determine the future success of the XRP token.
Market Flooding of the Token
As per the second-quarter report, 1 Billion XRP were released out of escrow for each month within the quarter. 2.1 billion XRP out of the released Tokens went back into new escrow contracts.
This, of course, goes without saying that excess supply of the token produced the market dynamics that suppressed prices despite fundamental gains by the Organization Behind the token.
It is this kind of market flooding that provides reduced prices which affects the book value investment of the Token. These kinds of moves also scare away potential investors who may have deep pockets. Especially because crypto summer is already here.
Shareholding in Centralized Technologies
While the gambit played by the Ripple CEO in the acquisition of shares in Moneygram has paid off in the short term, there remains the long-term risk of associating a cryptocurrency with centralized systems.
It’s this sort of paradox that Facebook is currently finding itself in with its Libra project as the social network can’t separate itself from the cryptocurrency.
While XRP may not face the same degree of scrutiny (mainly because Zuckerberg wants to take over the World perhaps!), it will face something quite similar because Moneygram is a centralized tech.
This, of course, is a real cause for concern. Especially when the crypto fans discover something sticky and messy about Moneygram.
While it may turn out to be the opposite, XRP’s developer platform Xpring hasn’t gained quite the traction it was developed to gain.
Unlike Ethereum’s Smart Contract system with its programming language (solidity) Xpring is still a dark horse for XRP and it is showing at the moment. For now, though, these are the grey areas which the guys at Ripple headquarters need to sort out.
In answer to the question of XRP’s Selloff being either a False Start or Kickstarter, it’s still way too early to tell. But by Crypto Summer We shall know!
What do you think? Has XRP performed well this quarter? Let us know your thoughts in the comment section below!