Ripple Labs has revealed that, for the first time in the company’s history, its holdings of XRP have dropped below 45%, a significant milestone for the cryptocurrency market. This significant trading volume increase for XRP coincides with this milestone, indicating a general upswing in market conditions and a growing interest in the digital asset.

Ripple’s continuous efforts to decentralize the network and lessen its control over the coin are partially to blame for this fall. Ripple has been selling XRP for several years to finance its operations, encourage network expansion, and promote wider acceptance of the digital asset.

According to the report, there has been a major change in XRP market performance, as the trading volume has reached  $865 million in first quarter of 2024. The average open interest in derivatives on a daily also experienced a major increase of $500 million, compared to it’s former $460 million it had in the last quarter.

Exchanges Notice XRP Trading, Renewed Investors Interest Linked 

According to recent market data, there has been a noticeable surge in XRP transactions on critical exchanges. Numerous factors, such as increased interest from institutional investors, new collaborations using XRP for cross-border payments, and the expanding global acceptance of Ripple’s payment solutions by financial institutions, are responsible for this surge in activity.

Compared to prior quarters,  daily trading volume increased significantly to consistently above $2 billion in the most recent quarter. A month ago, XRP was trading at $1.10; as against the current $1.50, indicating that investor confidence in the asset has returned.

Because of its substantial holdings, Ripple has always been criticized for having considerable control over the XRP ledger. Mustafa Mulla from CoinPedia revealed that more liquidity usually results in more stable pricing and lessens the effect of big trades on the market, which is advantageous to institutional and retail investors.

Ripple Sells 841.5 Million in First Quarter, Analysts Predict Stronger Popularity

Analysts predict that XRP may experience more price growth and broader popularity if the present patterns hold. In the first quarter of 2024, Ripple sold 841.5 million units of XRP for  $440.6 million, at $0.5236 per unit. This represents a 16% drop in sales, unlike the last quarter, which recorded 1.006 billion XRP in sales.

40.1 billion XRP went into escrow out of 44.94 billion XRP of Ripple’s holdings, which are Ripple’s subject to monthly releases. CCData, a reputable industry financial data providers, has noticed that majority of the contributions come from top cryptocurrency exchanges like Upbit, Binance, Bitstamp, and Coinbase, referencing intense trading activities across many trading platforms.

These sales, rising market activity, and XRP’s dissemination across several channels have progressively lowered Ripple’s market share. Ripple’s first quarter 2024 XRP report released on May 17, 2024 explained major developments in the XRP market.

Ripple CTO Speaks, Clarifies Rumors of Heightened Inflation 

In the latest data published by the company, the said balance in the escrow has further declined to  39.7 billion XRP because of the extra sales it had between April and May. The spendable balance in Ripple’s possession is 4.84 Ripple’s XRP, a difference of  237 million XRP recorded from the past quarter. The ongoing sale of XRP by Ripple has gotten some major market players talking about the future impact of such a move to XRP.

David Schwartz, the Chief Technology Officer (CTO) of Ripple, has come out to clarify that the current inflation rate of XRP is lower than that of its counterparts, citing Solana as an example, which has also performed well lately. He explained that his company is looking to significantly decrease its XRP holdings, pointing out that it’s using burning to create scarcity that will not impact the price much.

Schwartz made this statement, citing Stellar as a point of reference. However, XRP is currently bullish amid the recent challenges. After testing its support strength at inter-day low, it trades at $0.514, XRP, and later rises to $0.52, representing a 1.195% increase at press time.