This increase in activity highlights a growing utility within the network, sparking optimism among XRP enthusiasts.
Understanding XRPL Velocity and Its Implications
Maartunn explained that a rising velocity indicates frequent network usage. This trend might serve as an early signal of a potential price surge for XRP.
Currently, XRPL’s velocity is nearing a resistance level within a descending trendline. This movement points to increased network usage and the possibility of further price growth.
XRPL Velocity and XRP’s Price Performance
The rise in XRPL velocity aligns with XRP’s recent price rally following the outcome of the US elections. The token’s value surged from $0.5319 on November 6 to a peak of $2.82 by December 3, marking a remarkable 430% increase in under a month.
However, despite the velocity uptick, the total value deposited on the XRPL blockchain has been declining since December 16. According to DefiLlama data, deposits fell from $71.5 million to $58 million, reflecting a nearly 20% decrease.
XRPL’s Total Value Locked and AMM Pools
The total value locked (TVL) in XRPL is closely tied to the automated market maker (AMM) pools within the blockchain. In addition to the TVL, approximately $5 million in tokenized treasury bills issued by Open Eden are actively circulating on XRPL, contributing to its ecosystem growth.
Ripple’s Initiatives to Drive XRPL Growth
Ripple Labs, the company behind XRPL, has recently introduced a stablecoin named Ripple USD (RLUSD). Although RLUSD launched less than two weeks ago, it is already seen as a catalyst for XRPL’s expansion.
Tokenizing Real-World Assets (RWA) on XRPL
Ripple aims to attract traditional businesses to tokenize real-world assets (RWA) on XRPL. The RLUSD stablecoin is expected to create a liquidity stream, fostering the network’s growth. Ripple emphasized this strategy in their stablecoin launch announcement.
Bitwise has estimated that the RWA market could reach $3 trillion in the near future. These developments are poised to further enhance XRPL’s usage and velocity.
Conclusion
The rising velocity of the XRP Ledger underscores growing activity and utility within the network. While challenges like declining deposits persist, Ripple’s innovative initiatives, including RLUSD and partnerships for tokenizing real-world assets, could drive substantial growth for XRPL in the comingi need a prompt for image generation for this news
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