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    Fun-loving and cheerful, a passionate blockchain and crypto writer who knows no boundaryโ€ฆconnect if you share the same passion. With 10+ years of writing experience, I am a Crypto Journalist by chance, exploring, and learning all the dynamics of the sci-fi action-filled crypto world. Currently, focusing on cryptocurrency news and price data. With a passion for research and challenging my capabilities, I am slowly getting into the crypto arena to bring new insights every day.

    • 1 minute read

    Does Ripple’s ODL Really Drive Up XRP Price? Experts Debate

    Story Highlights
    • Ripple's payment system (ODL) doesn't directly raise XRP price.

    • Ripple argues XRP value comes from use, not speculation.

    • XRP price, Ripple's promotion, and ODL volume are all connected.

    Renowned crypto figure Panos Mekras recently sparked a lively debate within the XRP community, focusing on Rippleโ€™s On-Demand Liquidity (ODL), now rebranded as Ripple Payments, and its impact on XRP’s market value.

    Mekras vs. Community

    Mekras firmly stated the fact that Rippleโ€™s solution for cross-border payments, though successful, does not guarantee to influence the price of XRP. Developers revealed that Ripple promotes its products, like ODL, as part of its business strategy. Yet, recent data shows XRP purchasers make independent investment decisions, not solely relying on Rippleโ€™s efforts.ย 

    According to Mekras, most ODL transactions involve immediate buying and selling of XRP, without generating significant demand for XRP from ODL itself. This perspective aligns with Rippleโ€™s submission to the SEC, where they explicitly stated that most ODL transactions are demand-neutral and do not impact XRPโ€™s price. Furthermore, Mekras points out that much of the XRP utilized for ODL originates from Rippleโ€™s escrow, which introduces additional selling pressure by injecting โ€œnewโ€ XRP tokens into the market. 

    Consequently, Mekras concludes that Rippleโ€™s payment solution alone cannot drive up the price of XRP. 

    In this context, Ripple provided a document to the SEC stating that most transactions using On-Demand Liquidity (ODL) donโ€™t affect XRPโ€™s price. This suggests that the value of XRP isnโ€™t heavily influenced by speculative trading but rather by its practical use in cross-border payments. This reinforces Rippleโ€™s argument about the utility of XRP beyond market speculation.

    Community Response

    However, Nietzbux brings a different perspective, stressing the importance of market liquidity and a strong XRP value for effective ODL. He suggests expanding XRP’s uses to boost demand, rather than relying only on Ripple’s efforts.

    Nietzbux finds this logic senseless, suggesting that it implies Ripple is relying on the community to generate the necessary demand and price increase for XRP. 

    He presents a hypothetical scenario where a large bank wishes to transfer $100 billion using XRP, highlighting the impracticality due to the lack of liquidity. Nietzbux prompts reflection on why major banks havenโ€™t embraced ODL fully and why ODL volume remains low compared to XRPโ€™s total trading volume.

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