XRP’s liquidity sees a hike, but where does its price stand?
- XRP’s liquidity ranking was extremely high which could attract potential investors.
- Despite challenges, growing XRP holders and increased token velocity offered positive signals.
XRP’s recent price performance was lackluster, but a glimmer of hope emerged as new data suggested potential recovery avenues, particularly in terms of liquidity rankings.
Recent data from Kaiko showed XRP’s impressive liquidity ranking. This metric indicates the ease with which an asset can be bought or sold without affecting its price. It was exceptionally high for XRP.
This heightened liquidity not only reflected positively on the token’s market depth but also had the potential to attract retail investors seeking an investment that cannot be easily influenced by large traders.
Kaiko Research's Q4 Token Liquidity Ranking is out!
BTC, ETH, XRP, and DOGE held on to the top four spots, though SOL will be looking to break in next quarter 👀
How did your tokens do? pic.twitter.com/TQ3yoKzkQ7
— Kaiko (@KaikoData) January 11, 2024
XRP’s price declined
Despite the high liquidity ranking, XRP’s price stood at $0.598475 at the time of reporting, marking a 1.09% decrease in the last 24 hours.
The dip raised concerns as the network growth for XRP also declined, indicating a waning interest among new addresses. This trend could pose a challenge to XRP’s recovery prospects.
In contrast, the overall number of XRP holders continued to grow, accompanied by an increase in velocity around the token.
This surge in token velocity suggested heightened activity and engagement among existing holders, potentially mitigating the impact of the dwindling interest from new addresses.
While the number of XRP holders and token velocity remained encouraging, the state of the Ripple network presented a mixed picture.
Over the past month, the number of code commits and core developers witnessed a significant decline. This could impact the ability of the network to ship changes to the network faster and may have negative impacts on both protocol and the token in the long run.
Growth in other areas
In the decentralized exchange (DEX) space, XRP experienced massive growth. DEX volumes on the XRP network surged, accompanied by a rise in daily new XRPL assets issued and an increase in the daily net amount of XRPL trust lines created.
XRPL, or the XRP Ledger, serves as the underlying technology supporting XRP transactions.
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The positive traction in DEX volumes and XRPL-related activities could potentially offset the challenges posed by a dip in new code commits and core developers.
The surge in activity could also aid sentiment around XRP in the future.