Recent weeks have seen heightened activity on the XRP Ledger (XRPL), with its velocity calculated as market cap divided by transaction volume on the rise. Analysts associate this with increased network usage, often a precursor to price surges.
The velocity metric, nearing a breakout on a descending trendline, hints at upward price movement.XRPL’s velocity approaching resistance on a descending trendline reflects growing utility, complementing XRP’s recent price leap. Following the U.S. elections, XRP climbed from $0.5319 on Nov. 6 to $2.82 on Dec. 3, a staggering 430% jump in under a month.
However, while velocity has risen, blockchain deposits have dropped nearly 20% since Dec. 16, from $71.5 million to $58 million, per DefiLlama. XRPL’s total value locked (TVL), tied to automated market maker (AMM) pools, is also in decline, though $5 million in tokenized treasury bills issued by Open Eden circulate on XRPL.
Ripple Labs, XRPL’s creator, recently launched the stablecoin Ripple USD (RLUSD), issued on XRPL and Ethereum. Aimed at fostering XRPL growth, RLUSD seeks to establish a regulated, USD-pegged token. Ripple envisions traditional firms tokenizing real-world assets (RWA) on XRPL, creating liquidity streams through RLUSD.
With Bitwise projecting the RWA market could hit $3 trillion, Ripple has partnered with Archax to launch an abrdn-managed money market fund. These initiatives could further boost XRPL usage and velocity.