Ripple releases Q2 2020 report, reveals purchases of XRP.

by | Aug 3, 2020

Ripple voluntarily releases its quarterly report to provide transparency and regular updates on the company’s views on the state of the XRP market. Q2 2020 was no exception, with Ripple releasing the report on August 3rd.

According to the report, Ripple’s total XRP sales during the quarter were $32.55 million (USD) vs. $1.75 million in the previous quarter. Ripple continued the pause of programmatic sales, focusing solely on its over-the-counter (OTC) sales as part of providing increased XRP liquidity to RippleNet’s On-Demand Liquidity (ODL) customers.

Ripple has increased its institutional OTC sales in comparison to the past two quarters. Compared to the same period last year though, current sales are 70% less. With XRP’s average daily volume dropping from $322.66 million in Q1 2020 to $196.28 million in Q2 (Crypto Compare metrics), Ripple increased its total sales as a percentage of total volume from 0.006% to 0.18%, an increase of 3000%.

While many construe Ripple’s sales as negative, these sales also shed a positive light on ODL. The more activity there is in ODL the more demand in liquidity there will be from Ripple’s customers and third parties.

What was particularly interesting about this quarter’s report was Ripple’s revelation that Ripple also buys XRP:

“A healthy, orderly XRP market is required to minimize cost and risk for customers, and Ripple plays a responsible role in the liquidity process. As more financial institutions leverage RippleNet’s ODL service, more liquidity is added into the XRP market. That said, Ripple has been a buyer in the secondary market and may continue to undertake purchases in the future at market prices.”

XRP’s standard deviation of daily returns over Q2 was 3.0%, representing a decrease in volatility from Q1’s 6.2%. XRP’s volatility over the quarter was lower than that of bitcoin (3.4%), and lower than that of Ethereum (4.2%).

In Q2 2020, three billion XRP were released out of escrow (one billion each month). In total across the quarter, 2.6 billion XRP were returned and subsequently put into new escrow contracts. You can read all about the escrow feature, view past and future escrows, the wallets that are used and Ripple’s release history since its inception at our escrow page.

In Q2 2020, ODL accounted for nearly 20% of RippleNet volume. Comparing just H1 2019 with H1 2020, RippleNet experienced 11x year-over-year growth in ODL transaction volume. With Ripple’s shift from large treasury payments to individual, low-value transactions, and the recent drop of ODL volumes, it would be interesting however to see a quarter on quarter comparison.

The Ripple report ends by mentioning various key XRP integrations. Binance launched an exchange-traded options contract and Huobi XRP perpetuals. Sygnum Bank added XRP to its highly regulated custody solution and financial platform and Zero Hash integrated XRP to its settlement platform, allowing digital asset businesses to access U.S. markets. Swisscom Blockchain, one of the largest telecommunications providers in Europe, successfully launched XRP on its DAPPI platform, enabling enterprise-grade access to the XRP Ledger for a wide array of use cases. Mobile payments startup Uphold completed the integration of XRP into its wallet. 

Ripple hopes to see a continued evolution of XRP infrastructure over the coming months, particularly in the derivatives space, that will further solidify XRP as a top three digital asset, adding to its robustness and liquidity.