The price of Ripple (XRP) has ranged widely over the past month, having declined 40% before recovering slightly. The market cap now stands at US$66.3 billion, with US$235.7 million in trading volume over the past 24 hours. The XRP ledger has processed US$808.6 million in transactions over the same period.
Having launched in 2012, Ripple is designed to provide a frictionless experience when sending money using the power of blockchain. While cryptocurrencies such as Bitcoin typically target peer to peer transactions, Ripple targets financial institutions. Banks and payment providers can use the digital asset XRP to reduce their costs and access new markets.
While Ripple announcements often focus on new partners, the company has recently made headlines with philanthropy. In addition to the US$29 million donation to Donor’s Choose in May, Ripple recently donated US$4 million, denominated in Rwandan Francs, to an Ellen Degeneres’ wildlife charity. Ripple has also committed over $50 million to a University Blockchain Research Initiative which will help foster research and innovation at 17 higher learning institutions worldwide.
However, a recent class-action lawsuit is overshadowing the networks growth and the companies donations. The San Francisco-based company created billions of coins “out of thin air,” states the complaint, and then profited by selling them to the public in “what is essentially a never-ending initial coin offering.” The plaintiff, investor Ryan Coffey, is seeking unspecified damages and a declaration that Ripple Labs and Chief Executive Officer Bradley Garlinghouse sold unregistered securities. Coffey is seeking to proceed on behalf of all purchasers of Ripple tokens. Ripple Labs will be represented by former SEC chair Mary Jo White.
Ripple Labs CEO Brad Garlinghouse said, “I think it’s very clear that XRP is not a security, it exists independent of Ripple the company.” Garlinghouse has been an outspoken critic of Bitcoin calling it “slow and expensive” and has also said, “blockchain hype is outpacing the reality."
Current SEC chair Jay Clayton has continued to dodge the direct question of whether or not XRP represents an unregistered security, but has said: "we are not going to do any violence to the traditional definition of security that has worked for a long time.” Without additional guidance from the SEC regarding cryptocurrencies, crypto assets, or ICO’s, there is likely to be an increase in U.S. litigation surrounding the matter.
In the meantime, Former CTO of Ripple and co-creator of Interledger, Stefan Thomas, has announced the release of Codius, a smart contract platform allowing for interoperability between blockchains, including XRP. The project was originally announced in 2014 while Thomas was working at Ripple Labs, but never got off the ground. Although open-source, Codius will be used by Thomas’ new company, Coil, which aims to develop a subscription-based product for content monetization on the internet, without advertising or selling user data.
Ripple Price Analysis 8 June 2018 1On the network side, version 1.0.0 of Rippled server code has been released. The mandatory upgrade introduces minor changes and bug fixes. There network currently consists of 722 public nodes. The top 100 largest XRP accounts hold 81% of the money supply. Ripple, the company, owns about 60% of XRP according to Garlinghouse.
Transactions per day have remained steady, at ~800,000, since mid-April. Transaction fees, which correlate with network traffic, have been minimal compared to other coins, and are currently around US$0.006 for each transaction.
Ripple Price Analysis 8 June 2018 2Kalichkin’s 30-day network value to estimated on-chain daily transaction ratio (NVT) has been trending lower since July 2015 (log scale), suggesting transactional use has increased since that time, reaching a low in January. NVT has also recently turned lower, showing evidence for an uptick in transactional value. Although NVT is difficult to compare between coins, which use different transactions types, it can be used to assess the network’s relative utility over time. XRP’s daily NVT remains relatively low based on historical data.
