Ripple Faces Scrutiny Over On-Chain Activity
Ripple, the firm behind the XRP cryptocurrency, is navigating increased scrutiny regarding the transaction volume on its XRP Ledger (XRPL). Questions arose from online entrepreneur Andrei Jikh, who voiced concerns about the lack of readily available, verifiable on-chain data that supports Ripple’s claims of extensive institutional partnerships. This sparked a response from Ripple‘s Chief Technology Officer, David Schwartz, who directly addressed the critiques.
Schwartz’s Explanation: Off-Chain Preferences and a Changing Landscape
Schwartz acknowledged the relatively low on-chain activity and provided context for the situation. He highlighted a historical preference among institutions for utilizing digital assets off-chain, rather than directly engaging with the XRPL. He mentioned even Ripple itself doesn’t primarily leverage the XRPL decentralized exchange (DEX) for its core transactions. Schwartz attributed this in part to concerns about terrorism financing. He also suggests this trend is “close to changing” because “institutions are starting to see the benefits of moving onchain.”
The Current State of XRPL and its Ecosystem
Launched in 2012, the XRPL is a public, open-source blockchain intended to facilitate business transactions and serves as the foundation for XRP. Despite its positioning and numerous partnerships, the lack of readily available on-chain tracking data to measure the real impact of these partnerships on transaction volume is a pain point. This makes it difficult to verify actual XRPL activity.
On-Chain Volume Declines, But Resilience in DeFi
Ripple reported a 30-40% decline in both new wallet creation and overall transaction volume on XRPL during Q1 2025. Despite this contraction in overall volume, the company noted that its DeFi activity was more resilient, with decentralized exchange (DEX) volume only falling 16% quarter-over-quarter. This highlights a potential area for future growth.
Transparency Concerns and Ripple‘s Response
Ripple has stated that it will sunset its XRP Markets Report, though they will share relevant updates on XRP through official channels. This shift is a strategic move, possibly influenced by feedback and also to streamline what and how Ripple shares information with the public.
Implications and the Future of XRPL
The conversation surrounding Ripple‘s approach to transparency, on-chain data, and institutional adoption is ongoing. The lack of readily available data creates a challenge to properly assess XRP’s growth. If the current trajectory of institutional movement on-chain continues, the volume on XRPL will likely rise, as well. As Ripple seeks to evolve its reporting methods and adapt to the changing landscape, a focus on facilitating transparent on-chain activity could be crucial for validating Ripple’s partnerships and expanding the adoption of XRP.
