Analysis: Q4 report of Ripple XRP is promising

We share insights into ripple’s performance and sales during the last record-breaking quarter of 2017. The last quarter of 2017 was an exciting one for most cryptocurrency’s, and this is no different for ripple (XRP).

Quarterly sales
In Q4 of 2017, investors bought $20.1 million worth of XRP directly from Ripple’s licensed money service business (MSB), LLC. The majority of new investors were institutional buyers whose purchases came with certain restrictions which minimize their risk in the event of market volatility or instability.
In addition to these sales, Ripple sold $71.5 million worth of XRP programmatically which proved to be a small percentage of the general global exchange volume. During 2017’s last quarter, XRP sales accounted for 0.075% of the $95.4 billion that was traded. This indicates a marked decline from the previous quarter, where XRP sales accounted for 0.20% of the industry’s total sales.


Market Commentary on Q4
Despite the decline in traded percentage, Q4 proved to be a definite point in history for XRP. The beginning of the quarter experienced an insignificant start with price ranging between $0.20 and $0.30. However, this quickly changed on December 12 when the XRP quickly increased in value and continued its trajectory up until the end of the month. On December 21, XRP made history when it reached trading prices of $1.00 for the very first time, and even hit prices as high as $2.19 on December 20. However, since then the price has stabilized to around $1.91. The price increase indicates an impressive growth rate of 887% from quarter-to-quarter, and a staggering growth of 29,631% from year-over-year.
Considering the massive price increases, Q4 in many respects seemed to imitate Q2. However, Q4 experienced much more growth as it expanded from $8 billion at the end of Q3 and reached $191.0 billion at the end of Q4. This price growth has placed XRP in the sought-after position of being the world’s second largest cryptocurrency.

An eventful quarter
At the start of Q4, most market participants seemed mainly concerned with bitcoin, and its fork, bitcoin cash, especially after two of the world’s largest exchange Cboe and CME Group announced their launch of bitcoin futures contracts. The arrival of bitcoin futures contract proved a tumultuous time in the history of cryptocurrency as it was an interesting milestone and turning point for cryptocurrency when digital assets started occupying a space on mainstream investment platforms. Since XRP has never had any links or affiliations with bitcoin or other cryptocurrencies, it is unsurprising that while most cryptocurrencies established themselves during this time, XRP opted to consolidate.

However, the XRP markets grew stronger as the quarter progressed. This was in no small way helped by the announced partnership between Santander and American Express, the newly established links between Korean banks and the Japan Bank Consortium, as well as the escrow activation. The escrow activation proved especially beneficial to XRP markets worldwide as it strengthened market participants’ confidence and trust in the XRP project. In addition the Amex/Santander partnership confirmed that the XRP client-base was growing stronger. At the moment, most RippleNet users mostly use xCurrent. However, current trends suggest that more institutions are likely to embrace networks such as xRapid and XRP in order to enhance liquidity.

However, Q4 was also an interesting one for other cryptocurrencies which saw the development of positive and negative elements. For example, there is widespread concern regarding the public war between bitcoin and bitcoin cash, while litecoin and ether are currently showing some concern regarding leadership. Considering these issues, XRP may prove to come out on top.

Since more companies and organizations are looking towards implementing blockchain technology, it will be vital for networks to demonstrate a certain robust quality, especially when it comes to resolving disputes on the network and leadership, as most large companies will choose to use already established blockchain networks rather than build their own. Ripple’s consistency and steadfast approach might make it the network of choice.

Dramatic volume increases
Ripple experienced a major increase in daily trading volumes during Q4, which is likely to give it yet another competitive edge in the next year. XRP’s goal is to become an efficient means of conducting cross-currency transactions; however in order to achieve this, the company will have to generate an even greater volume as well as more comprehensive order books. During Q4, daily trading volumes averaged at $807.6 million, which demonstrates a 35,341% increase compared to Q4 of 2016.
Towards the end of Q4, XRP’s daily trading volumes increased dramatically as it reached a daily trading average of $2.77 billion since December 11.
There are multiple factors which contributed to this success including the emergence of XRP/MXN trading pairs of Mexican exchanges, but also the fact that XRP became available on over 50 different exchange worldwide during this time.

What’s next for XRP
While cryptocurrencies entered the mainstream in 2017, 2018 will see the emergence of more widely diverse cryptocurrency-related products. The team behind Ripple has confirmed that they intend to focus this year on the cryptocurrency’s liquidity and hope to reach the same level of liquidity that most foreign exchange markets have, which will bring it closer to its goal of becoming the global standard for cross-currency transfers.

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