Q1 2017 XRP Markets Report

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In order to continually improve the health of XRP markets globally, we will share regular updates on the state of the market including quarterly sales, commentary on previous quarter price movement and related company announcements.

분기별 판매
1분기 시장 참가자들은 Ripple에서 등록하고 라이선스를 보유하고 있는 통화 서비스 비즈니스(MSB)인 XRP II, LLC*에서 직접 670만 달러 만큼의 제품을 구매했습니다. 이러한 구매자들은 본질적으로 기관인 경향이 있으며, 대규모 후속 판매로 인한 시장 불안전성의 위험을 완화시키는 데 도움이 되는 제한 사항이 구매 내용에 포함됩니다.

Market Commentary: A Quiet Start to a Raucous Ending
Though Q1 2017 began much in the same way as Q4 2016, quietly, it ended with a dramatic spike in market activity.

1월 및 2월 동안 일간 변동성**은 2.47% 감소하였는데, 이는 이미 안정된 4분기의 3.26%보다 현저히 낮은 수치였습니다. 첫 두 달의 평균 일간 규모는 4분기 규모보다 55% 감소하여 122만 달러까지 하락했으며, 3월 초에는 잠시 0.00538달러까지 떨어지기도 하였습니다. 이는 2016년 5월 이후 볼 수 없었던 수준입니다. 활동 감소의 상당 부분은 일부 유명한 시장 조성자들의 일시적인 퇴장, 또는 ETF 승인에 대한 기대감에 따른 BTC의 상대적인 수요로 인한 것일 수 있습니다. 원인이 무엇이든지 2017년 1분기는 한동안 XRP 시장에서 가장 힘든 시기 중 하나였습니다.

A bright spot was Bitstamp’s successful launch of XRP for USD, EUR, and BTC currency pairs on January 16th. That alone was not enough to turn the tide however, and XRP markets failed to show much life until March 23rd, what was easily the most significant day of the quarter.

On March 23, XRP rallied from $0.0072 to $0.0112, a 56% price increase on an impressive $19.7M in volume, a 1103% increase over the average daily volume up to that point in Q1. Clearly something had changed, but why such a powerful shift in sentiment? Though always difficult to discern in real time, in hindsight, a few key developments may have had an impact.

  • As the month drew to a close, the Bitcoin scaling debate raged on with no end in sight.
  • Throughout the quarter, Ripple, became more vocal about its commitment to XRP and the Ripple Consensus Ledger (RCL) as part of its long-term strategy.
  • Ripple announced a new relationship with BitGo to build an enterprise wallet, as well as Payment Channels and Escrow, important RCL features that increase transaction throughput to levels comparable with those of Visa’s network.
  • Ripple continued to sign up banks to commercially deploy its enterprise blockchain solution and join its global payments network. Announcements included the addition of MUFG, the world’s third largest bank, 47 banks in Japan and network expansion into the Middle East and India through NBAD and Axis Bank.

The last point is particularly important. Markets are clearly connecting the dots that banks which join the Ripple network today are prospective users of XRP liquidity in the future. Growing bank membership of the Ripple network creates opportunities for Ripple to deepen those customer relationships and cross-sell liquidity solutions built on XRP, all of which should be beneficial to the asset.

Lastly, there are a few data points which warrant close monitoring going forward. The percentage of off-ledger trading was only 25.2% in Q4, but that leapt to 71.1% in Q1. Interestingly, and very much related, the percentage of XRP flows that originated from BTC in Q4 was only 45.1%, and that grew to 66.6% in Q1. The data suggest most of the growth in trading volume is coming from off ledger BTC/XRP activity, which supports the theory that the rally in Q1 was driven by market recognition of Bitcoin’s risks, as well as XRP’s advantages.

Why is this significant? In Q1 2017, XRP grew substantially in both price and volume due to off-ledger inflows via Bitcoin. In order for any asset to be successful it needs ample liquidity, something XRP attracted during the quarter. This was a reassuring sign of progress towards the eventual fiat liquidity XRP requires to ultimately be successful for payments, its natural use case.

Q2 2017
We’ve put our ear to the ground and have been listening to important feedback from the XRP community. This includes the need for greater visibility and transparency into Ripple’s vision, strategic use cases for XRP, and plans to increase liquidity and decentralization. To that end, we plan to increase our communications cadence to address this feedback. We also look forward to having a large presence at Consensus in New York in May.

In addition, you may want to watch out for specific announcements in Q2 regarding potential ways to use RCL’s new Escrow feature, as well as our plan to implement a systematic markets operation program designed to add liquidity to the market especially during volatile periods.

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*XRP II, LLC is licensed to engage in Virtual Currency Business Activity by the New York State Department of Financial Services.

**Volatility calculated using standard deviation of daily lognormal returns.