XRP News Today: Ripple CTO Attributes 30-40% On-Chain XRP Volume Drop to Off-Chain Settlements

Ripple’s chief technology officer, David Schwartz, has defended the declining transaction volumes on the XRP Ledger (XRPL), attributing the trend to the company’s choice to facilitate settlements with financial institutions off-chain rather than on the public blockchain. The explanation follows a 30%–40% drop in on-chain XRPL activity reported in Ripple’s Q1 2025 XRP Markets Report, which highlighted reduced new wallet creation and overall transaction volume [1].

The drop in on-chain activity has sparked questions about the real-world usage of XRP, particularly as Ripple maintains partnerships with over 300 financial institutions. Critics, including online entrepreneur Andrei Jikh, have raised concerns about a lack of verifiable on-chain data to substantiate Ripple’s claims of institutional adoption. In response, Schwartz emphasized that many institutions prefer off-chain settlements for efficiency and regulatory compliance, though he acknowledged that this approach limits the transparency of XRP’s role in cross-border payments [1].

Schwartz also noted that while on-chain adoption has been slow, there are signs of a potential shift as institutions begin to recognize the benefits of moving transactions onto the blockchain. However, he did not elaborate on how Ripple plans to encourage this transition. The CTO also mentioned the risk of terrorism financing as a reason for not relying on the XRPL DEX for payments, suggesting that features like “permissioned domains” could help mitigate such risks, though no further details were provided [1].

Despite the reported decline, Ripple’s report indicated that DeFi activity on the XRPL was more resilient, with decentralized exchange volume dropping by just 16% quarter-over-quarter. However, platforms like DeFiLlama show only $81.8 million in total value locked (TVL) on XRP Ledger DeFi applications, underscoring the limited visibility of institutional activity on the chain [1].

In May 2025, Ripple announced it would discontinue the XRP Markets Report in its current form, stating that it would continue to provide transparency through its official channels. The company emphasized that additional insights would follow as more institutions engage with XRP, potentially reshaping the market narrative [1].

The evolving landscape highlights a broader shift in institutional preferences, where efficiency and compliance are prioritized over decentralization. This trend may influence how Ripple positions XRP in the future and could affect investor perceptions, particularly if on-chain activity continues to lag. Analysts suggest that Ripple’s ability to adapt to regulatory expectations and market demands will be key to sustaining its institutional partnerships [1].

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Source:

[1] Cointelegraph - [https://cointelegraph.com/category/latest-news](https://cointelegraph.com/category/latest-news)