XRPL Weekly Traction Report (2024/Sep/09-15)

Abstract

This report analyses on-chain XRPL activity from September 9-15, 2024, focusing on user engagement, transaction volume, and dApp interactions. With over 12.5 million transactions processed and 39,340 unique active wallets, the data reveals a mix of growing engagement in dApps and reduced overall wallet activity. This discrepancy is discussed, alongside notable performance in key dApps. The report provides valuable insights into the health of the XRPL ecosystem, emphasising evolving user trends and transaction patterns across different platforms.

This week's highlights

• XRPL Marketcap recovered to $97 million, compared to $85 million a week before.
• dApp engagement rose to 11.36% of UAWs interacting with dApps (up from 9.29%).
• OfferCreate makes 52% of total transactions.
• Only 9,905 (0.15%) OfferCreate transactions are made via dApps, indicating the dominance of trading/arbitrage bots.
• Unique Active Wallets decreased by 15.87% (39,340 wallets)

1. Introduction

Understanding XRPL ecosystem's health and dynamics is crucial for developers, users, and researchers in the blockchain space. This weekly report aims to provide a detailed analysis of the ledger's on-chain activity for the week of September 9-15, 2024, offering insights into user behaviour, dApp performance, and overall network trends.

2. Results and Discussion

2.1. Overall Network Activity

Key Observations

• Significant decrease in Unique Active Wallets: Down 15.87% from 46,762 to 39,340
• Increase in Total Transactions: Up 9.01% from 11,488,543 to 12,523,616
• Slight increase in Users with dApps Interaction: Up 2.90% from 4,343 to 4,469
• Proportion of active wallets interacting with dApps increased from 9.29% to 11.36%

There's an intriguing observation in this week's data: whilst the total number of Unique Active Wallets (UAWs) decreased significantly by 15.87%, the number of Users with dApps Interaction actually increased by 2.90%. Typically, one would expect these two metrics to have a positive correlation, but that's not the case here.

This discrepancy might be explained by a cooldown in interest for XRP speculation and transfers to or from centralised exchanges, where trading activity and transfers typically peak. The overall number of users likely settled following the market stabilisation after 6th September, which saw a significant wave of liquidations driven by heightened volatility.

XRPL ecosystem users, who are more engaged with on-chain activities, seem to be less affected by such market events. This could explain the more consistent dApp interaction figures.

Despite the overall decrease in active wallets, dApp engagement went up proportionally. In this week, 11.36% of active wallets (4,469 out of 39,340) interacted with dApps, up from 9.29% in the previous week.

2.2. dApp Usage Patterns

Key Observations

• Increase in single dApp users: Up 5.67% to 3,971 UAW
• Decline in multi-dApp engagement: Users of 2 or more dApps decreased across all categories
• Sharp decrease in power users: Those using 3 or more dApps declined by over 30%
• Growing single dApp loyalty: 88.86% of users stick to one dApp, up from 86.53% last week

This week's data reveals a continuing trend towards user loyalty to a single specific platform rather than ecosystem-wide engagement. The proportion of users sticking to one dApp has increased from 86.53% to 88.86%, indicating a growing concentration of user activity.

Simultaneously, a sharp decline in multi-dApp engagement was observed. The number of users interacting with two dApps decreased by 11.13%, while the decline was even more prominent for those using three dApps (-30.34%) or more than three dApps (-35.00%). This significant drop in the number of 'power users' - those who engage with multiple dApps - is particularly noteworthy.

The concentration of users on single dApps suggests that many might not be aware of other tools and projects within the ecosystem. Also, it is likely that these users are simply not interested in other dApps once they found their go-to service. However, low numbers for multi-dApp users might raise concerns about the overall health and diversity of the ecosystem. A thriving blockchain environment typically benefits from users engaging with a variety of applications.

2.3. Individual dApp Performance

Key Observations

• Growth Leaders: XPMarket and Magnetic showed significant growth in Unique Active Wallets (UAW).
• Sharp Decline: DexFi experienced a substantial drop in UAW (-46.56%) after rapid growth the previous week.
• Continued Decline: XRP Cafe saw an outflow of UAWs for the second consecutive week.
• Market Dynamics: The overall dynamics suggest healthy competition among XRPL dApps.
• Low Utilisation: dApp usage remains relatively low, both as a percentage of total UAW and in absolute values.

An examination of transaction patterns across various dApps within the XRPL ecosystem reveals a diverse and evolving landscape. Each platform appears to be establishing its own niche whilst contributing to the overall vitality of the network.

Payment transactions constitute the fundamental activity on the XRPL, with XPMarket, Magnetic, and DexFi demonstrating notable volume. XPMarket's 12,201 payment transactions, followed closely by Magnetic's 10,400 and DexFi's 6,810, indicate substantial user engagement on these platforms.

The Decentralised Exchange (DEX) functionality, represented by OfferCreate and OfferCancel transactions, provides insight into trading behaviour across different platforms. Sologenic maintains its predominance in this category for the second consecutive week, with 4,333 OfferCreate and 1,057 OfferCancel transactions. However, it is noteworthy that these figures have decreased compared to the previous week, potentially indicating a shift in user trading strategies or overall market sentiment.

A particularly salient metric is the ratio of OfferCreate to OfferCancel transactions, which offers insights into user trading behaviour and platform dynamics. Magnetic exhibits an atypically low ratio of 1.87:1, signifying that for every two offers created, one is cancelled. XPMarket and Sologenic show relatively similar and natural ratios of 6.6:1 and 4.1:1 respectively. These variations may be indicative of differences in user base composition, trading strategies, or platform-specific features that influence order placement and cancellation behaviours.

XRP Cafe led in all NFT transaction types. However, the platform's efficiency in converting offers to sales appears to lag behind that of XPMarket. While XRP Cafe recorded 9,096 sell offers created with only 2,670 accepted (a 29% success rate), XPMarket demonstrated a substantially higher conversion rate of 55% (1,312 acceptances out of 2,365 offers).

3. All Types of Activity: A Comprehensive View of the XRPL Ecosystem

While previous sections focused on specific metrics and dApp activities, it is crucial to examine the overall network activity. This baseline view provides insights into the general health and trends of the XRPL ecosystem.

Key Observations

• Overall Transaction Volume: The total number of transactions across all types increased from 11,488,514 to 12,533,585, representing an 9.10% growth.
• Dominant Transaction Types: OfferCreate and Payment transactions continue to dominate, collectively accounting for 93.77% of all transactions in the most recent week.
• NFT-related transactions showed remarkable growth, particularly NFTokenBurn (+386.05%) and NFTokenMint (+93.14%).
• Payment transactions increased by 24.67%.
• AMM-related activities also saw substantial growth, with AMMCreate increasing by 236.84%.

Additional information can be found on https://xpmarket.com/
Previous week report here https://dev.to/enchstyle/xrpl-traction-update-2024sep02-08-4bod/