Q4 2017 Ripple’s XRP Markets Report
Ripple released press statement with some very exciting news. Although the news did not reflect in XRP’s price, we still think it added a great value and trust in Ripple and XRP. Please read and give us your thoughts in the comment section below.
To continually improve the health of XRP markets globally, we share regular updates on the state of the market including quarterly sales, commentary on previous-quarter market developments and Ripple company-related announcements.
In Q4 2017, market participants purchased $20.1 million directly from XRP II, LLC1 — our registered and licensed money service business (MSB). These participants tend to be institutional buyers, and their purchases typically include restrictions that mitigate the risk of market instability due to potential subsequent large sales
Additionally, the company sold $71.5 million worth of XRP programmatically as a small percentage of overall exchange volume. For Q4, these sales represented 0.075 percent (7.5 basis points) of the total $95.4 billion2 traded — a decrease from Q3 2017’s 0.20 percent (20 basis points).
Market Commentary: A Quarter for the Ages
XRP markets ended the year with a statement — one that will likely be remembered as a defining milestone in XRP’s history. Though the beginning of the quarter was relatively quiet — with prices trading in a range between $0.203 and $0.30 — XRP began rallying on December 12 and continued moving upwards throughout the month. It quickly reached and exceeded dollar parity on December 21. From there it climbed higher, briefly touching $2.19 on December 30 before retracing somewhat and finishing the quarter at $1.91. This price appreciation represents an impressive quarter-over-quarter increase of 887 percent and a year-over-year gain of 29,631 percent.
Everybody still talks about Korea’s impact on the market. Ripple gave us interesting insight on their thoughts on Korea’s impact.
Though Korean markets continued to be a significant driver of XRP activity during the quarter, growing geographic diversification of XRP liquidity lowered KRW market share to 44.8 percent of total Q4 volume.
Interestingly, this retracement of market share didn’t apply to KRW prices. As XRP advanced in Q4, so did Korea’s premium over USD markets. At times, prices were as much as 40 percent higher in Korea than the rest of the world. While it’s still somewhat early to tell, it will be interesting to see if these premiums develop into a leading or lagging indicator of market activity going forward.
Towards the end of December, rumours of a Korean government clamp down on the space began circulating. On December 27, the official news broke. However, much to the market’s surprise, the impact was muted. In fact, many markets — XRP included — continued to rally. However, what seemed like insatiable demand may have some challenges ahead. Given South Korea’s outsized volume share on digital asset exchanges, a more restrictive stance there poses a significant market risk.
And finally, what is in horizon for Ripple and other digital currencies?
What’s on the Horizon for Q1 2018
2018 is likely to be a pivotal year for the broader digital asset markets as a whole, as well as for XRP markets specifically. Q1 will be key to ensuring XRP’s liquidity eventually becomes more like that of existing foreign exchange markets and XRP achieves its goal of becoming the digital standard for international value transfer.
Price target for Ripple in 2018 varies from $1 to $20, some say even more, but watching market closely for months, you can almost never tell what might happen. One thing is sure, Ripple is here to stay for a long time.
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