XRP Ledger Sees Significant Increase in Network Activity in Q1 2023
The XRP Ledger (XRPL) experienced a surge in network activity during the first quarter of 2023, according to a recent report by research firm Messari. The daily active addresses and daily transactions increased by 13.9% and 10.7% quarter-over-quarter (QoQ), respectively. Additionally, XRP’s price showed an impressive increase of 56% QoQ, outpacing the total crypto market cap in the same period. This surge in price is largely due to positive news regarding the ongoing case between Ripple and the Securities and Exchange Commission (SEC).
The XRP Ledger is a blockchain network known for its fast and energy-efficient cross-border payment capabilities. It offers a variety of features, including Issued Currencies, a decentralized exchange, escrow functionality, and token management. Despite not supporting smart contracts, it can execute many of the same functions as other networks. The XRPL saw a significant increase in overall network activity metrics in Q1, as daily active addresses and transactions increased by 13.9% and 10.7%, respectively. The increase in total active addresses was largely due to receiving addresses growing by 17.1% from 47,000 to 55,000. However, sending addresses decreased by 7.2% QoQ, further separating the metric from receiving addresses.
The XRPL applies deflationary pressure to the total supply of 100 billion XRP through transaction fee burning. To counteract this burn rate, 1 billion XRP vests to Ripple per month. Any XRP not spent or distributed by Ripple in that month is returned to escrow. Unlike other crypto networks, the XRPL does not distribute rewards or transaction fees to validators who are instead incentivized by supporting the decentralization of the network.
The XRPL standardized NFTs on its network with the XLS-20 standard, enabled in October 2022. However, NFT mints declined 40.4% QoQ, and NFT offers accepted declined 25.1% QoQ. In NFT sales volume, XPUNKS remained the all-time leader, with Core Apes Club and RipplePunks also performing well.
Overall, the XRPL’s deflationary mechanism of burned transaction fees and focus on decentralization and trust between nodes through unique node lists are key factors in its success. As the network continues to grow and evolve, further developments and innovations in the platform’s native capabilities are likely to be seen.
– Messari Report