On June 3, Ripple (XRP) released a report on its Ripple Insights blog, where the company spoke about the inflated XRP volumes that have been stated on exchanges worldwide (as is the case with other tokens) and promising to take whatever possible steps to curb associated worries about market structure. The steps the team is taking, detailed below, is expected to cause XRP Q2 sales to drop.
In the report, Ripple states 3 actions that it has undertaken:
1. We are actively working with trusted partners in the space to better understand the scope and scale of the problem.
2. We are evaluating our approach to XRP volume reporting, including reviewing new options and requirements for sourcing market data.
3. We are taking a more conservative approach to XRP sales this quarter.
By intending to establish better volume metrics, Ripple is hoping that it will not negatively impact the market by selling too much through programmatic sales of XRP, dropping it down from 20 bps to 10 bps. The report reads,
In the short term, this means Ripple’s sales of XRP in Q2 2019 will be substantively lower (as a percentage of reported volume) than in the previous quarter—with our stated target of 20bps for programmatic sales of XRP volume, as reported by CoinMarketCap, likely dropping to less than 10bps. Longer term, by being more demanding about our expected standards for market structure and reporting, we hope to begin raising the bar industry-wide.
Lower sales targets, however, means that sales will be expected to be lower for Q2, which, in the long run, Ripple hopes will be good for both the token and the market.
Both the Blockchain Transparency Institute and The TIE, among others, have released reports about exchanges exaggerating volumes, with figures saying that up to 90% of exchanges engage in wash trading, including some of the more popular ones.
