- Data shows a significant rise in liquidity contributions and governance interactions on XRPL’s DEX, with AMM deposit volumes up 62.35%.
- Analysts suggest that the current XRP price pullback may be setting up for a rally, supported by XRPL’s growing functionality.
The Automated Market Maker (AMM) on the XRP Ledger (XRPL) network is seeing a significant increase in trading activity. Its daily transaction volumes are now up by a factor of 40 compared to just a week ago. This 40x spike signals a rising interest in XRPL’s decentralized trading framework. Moreover, many in the crypto community are pointing to the AMM feature’s new liquidity and trading capabilities as key drivers of this growth.
XRPL AMM Volume Spike
Crypto analyst Blockchain Backer, who is influential within the Web3 space, recently spotlighted this increase in AMM volumes. He noted, “#XRP AMM volume explosion. Daily volumes are 40X what they were a week ago.” With allowing users to contribute liquidity across assets, the AMM offers a feature that appeals to both retail and institutional participants.
Since the AMM went live, XRPL has observed significant growth in both AMM-based transactions and decentralized exchange (DEX) activities. According to data from CryptoQuant, XRPL’s DEX has witnessed a 17.6% rise in volume over the past month as platform engagement surged, reported CNF.
Also, Liquidity contributions within the XRPL rose significantly with AMMDeposit volumes up by 62.35% and AMMCreate activity surging by 143.1%. Governance interactions saw a similar boost with AMMVote activity increasing 65.22%, indicating active participation by XRPL’s community.
Many attribute this upsurge in activity to the AMM’s capacity to support several trading strategies while offering incentives to liquidity providers through yield-earning opportunities. The added liquidity and flexibility could draw more users to XRPL as a decentralized alternative to CEXs.
Earlier this month, Ripple also launched its custody solutions on the XRP Ledger, per the CNF report.
XRP Price Analysis & Potential For Growth
Alongside XRPL’s growth, XRP itself has been experiencing notable price fluctuations. On Friday, XRP price briefly traded at $0.4935 amid a market downturn but managed to recover, reaching $0.5144 on Saturday. However, it again slid back below the $0.50 mark.
However, market analysts have observed that XRP recently broke out from a longstanding trendline. This breakout initially took place in August with XRP moving from a low of $0.4335 to a high of $0.6416. Random Crypto Pal, a popular crypto analyst on X, shared his views on the current market situation.
He suggested that a major price movement might be imminent for XRP. He deemed the recent XRP price dip a “perfect retest of both trend lines.” This implies that the latest XRP’s pullback could be setting the stage for an impending rally, per the CNF report.
For further context, in September, XRP price hit a higher peak at $0.6622, its highest point since retreating from its annual high. However, October saw a decline to a two-month low despite the analysts being convinced about an “Uptober.” Nonetheless, some analysts believe this downturn may only be temporary, as XRP price appears to be testing a key support zone.
With renewed momentum in XRPL’s AMM and DEX functionalities, Random Crypto Pal believes that an “explosion is incoming” for XRP price. Furthermore, Ripple’s ongoing development of projects like the RLUSD stablecoin could also contribute to growing interest in the XRP ecosystem.
