$44 Million In Transactions As Activity Soars

XRP has been experiencing a significant increase in on-chain activity, which has resulted in a recent surge in its popularity.

Analysts and investors have expressed interest in the XRP Ledger, Ripple’s digital payment platform, due to its increased transaction throughput.

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CryptoQuant recently noted an increase in the NVT (Network Value to Transactions) Ratio of XRP in a post on X (formerly Twitter), which implies that on-chain activity has been increasing. This increasing NVT Ratio may indicate that the XRP network is more active than its current market valuation.

Market observers are keeping an eye on the altcoin’s value and activity, which of late are exhibiting a variety of signals. Despite the network usage’s surge, XRP price continues to encounter obstacles, with critical resistance levels imminent.

XRPL: Spike in NVT Ratio

“Given that the NVT Ratio is a calculation between Market Capitalization (which is stable around $51.1B) and On-chain Transaction Volume, this spike reflects higher transaction volume.” – By @JA_Maartun

Read more 👇https://t.co/11LKvfGjDQ pic.twitter.com/1tK1M95cKv

— CryptoQuant.com (@cryptoquant_com) November 13, 2024

What’s The Reason For The Increase In NVT Ratio?

A measure of the “value” of network activity is the NVT Ratio, which is calculated by dividing market capitalization by the volume of on-chain transactions. On November 2, XRP’s NVT Ratio saw a sharp rise, hitting 1,162 in a comparatively short amount of time.

This increase is primarily attributable to a surge in on-chain activity, which resulted in the network processing $44 million in daily transaction traffic, CryptoQuant data shows.

So, what does this imply? A high NVT Ratio usually suggests that the market capitalization hasn’t kept pace with the increased activity in the network, even though the network is in use. With respect to XRP, it implies that the number of transactions is higher, possibly for remittance or other purposes.

This increase in activity, however, has not yet translated into an increase in the price of the token. In fact, despite the rise in activity, the market capitalization of XRP has remained relatively constant, close to $51 billion.

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