XRP News Today: Ripple XRP Ledger On-Chain Activity Drops 30–40% Amid Off-Chain Institutional Shift

Ripple's XRP Ledger (XRPL) experienced a notable decline in on-chain activity in early 2025, with metrics such as new wallet creation and transaction volume dropping by 30–40% [1]. This decline has raised concerns about the transparency of the blockchain's usage, despite Ripple's public claims of over 300 institutional partnerships. The majority of institutional activity reportedly occurs off-chain, driven by regulatory and compliance concerns, as noted by Ripple’s Chief Technology Officer, David Schwartz [1].

Schwartz explained that institutions prefer off-chain transactions to maintain greater control and privacy, particularly to mitigate risks such as potential misuse for illicit activities like terrorism financing [1]. Ripple itself does not utilize decentralized exchange (DEX) transactions on the XRPL, reflecting broader industry caution among financial institutions. While Ripple is exploring solutions like “permissioned domains” to address risks related to on-chain liquidity providers, concrete on-chain adoption remains limited [1].

The XRP Ledger, launched in 2012, is an open-source, decentralized blockchain designed for enterprise use. Despite collaborations with entities like the Dubai government and Guggenheim, transparent on-chain metrics remain scarce, making it difficult to assess the network's real-world usage [1]. As of mid-2024, the total value locked (TVL) in XRPL DeFi applications stood at approximately $81.8 million according to platforms like DeFiLlama. Ripple’s CTO attributed this relatively low TVL to the off-chain preference of institutions, which limits visibility into the blockchain’s institutional adoption [1].

According to Ripple’s Q1 2025 XRP Markets Report, while overall on-chain activity dropped, decentralized exchange volume on the XRPL only declined by 16%, suggesting some resilience in DeFi segments [1]. The report also highlighted that the activity decline aligns with broader trends observed on major blockchains like Bitcoin and Ethereum.

In response, Ripple announced that it would discontinue the current format of its XRP Markets Report as of Q2 2025. The company plans to evolve its transparency strategy by sharing insights through official Ripple and RippleXDev channels. Ripple expects that as institutional engagement with XRP grows, new data will emerge to enhance market understanding and trust.

This shift in reporting reflects Ripple’s ongoing efforts to adapt to market dynamics and improve clarity around XRP's role in the financial ecosystem. While on-chain metrics remain subdued, the emphasis on off-chain institutional use and future reporting enhancements suggest a continued focus on building trust and transparency.

Institutional adoption of on-chain transactions remains slow due to regulatory concerns, but Ripple anticipates increased momentum as institutions begin to recognize the benefits of blockchain transparency and efficiency. The company's evolving approach aims to provide a clearer picture of XRP's market position and institutional relevance.

Source: [1] Ripple Sees Decline in On-Chain Activity Amid Transparency Concerns and Off-Chain Institutional Use (https://en.coinotag.com/ripple-sees-decline-in-on-chain-activity-amid-transparency-concerns-and-off-chain-institutional-use/)