Ripple Buying Back XRP in the Secondary Market at Market Prices Reveals Q2 2020 Report
In its Q2 2020 report, the fintech company Ripple shared that it has been buying back XRP and may continue to do so in the future, in contrast to what the market has been accusing the company of — dumping on XRP investors. The report reads,
“Ripple has been a buyer in the secondary market and may continue to undertake purchases in the future at market prices.”
Where on one side former Ripple CTO Jed McCaleb, who was owed 9 billion XRP by Ripple, has been constantly selling his stash — about 1.74 million XRP per day in the market in 2020 which increased by 266% compared to 2019, on the other side the company has been purchasing the digital asset at market prices. A Ripple enthusiast said,
“This means that the FUD that “Ripple dumps on its investors,” is actually the complete opposite of reality. Ripple is acting as a benevolent whale, countering the bad whales. This won't increase the price, but help prop it.”
The report also stated that the second quarter of 2020 saw its programmatic XRP sales remaining zero.
However, the over-the-counter (OTC) sales increased from $1.75 million in the previous quarter to $32.55 million XRP in 2Q20. This sale has been “part of providing increased XRP liquidity to RippleNet’s On-Demand Liquidity (ODL) customers,” which it says is “vital as ODL continues to evolve and expand into new corridors.”
According to Ripple, a healthy orderly XRP market is required to minimize both cost and risk for customers, and Ripple continues to play a “responsible role” in this liquidity process. It says,
“As more financial institutions leverage RippleNet’s ODL service, more liquidity is added into the XRP market.”
In the last quarter, ODL accounted for about 20% of RippleNet volume, which is an 11x year-over-year growth thanks to the increased volatility and exposed risk due to the crisis.
The daily volume, meanwhile, decreased in Q2 2020 at $196.28 million versus $322.66 million in Q1. Its volatility also fell from 6.2% to 3.0% over the quarter, which was “lower” than bitcoin’s 3.4% and Ethereum’s 4.2%.
However, its price is now back to moving. In the past ten days, it jumped 60% but is in red today just like the majority of the crypto market, trading at $0.30 — last seen in February just before the market-wide sell-off.
Ripple has also taken to reduce its emphasis on large treasury payments to focus on supporting “individual, low-value transactions, addressing the growing need in remittances and small- and medium-sized enterprise payments.”