Ripple, the company behind the XRP token has stated it expects, in the short term, their sales of XRP in Q2 2019 will be substantively lower – as a percentage of reported volume – than in the previous quarter.
It seems odd, taking into consideration the current market conditions, that Ripple would report a lower Q2 as things have only gotten better for the market heading towards the end of this quarter. However, Ripple’s reasoning for this is applaudable.
There is growing concern about false volume reporting on exchanges with even the likes of the SEC weighing in and noting in some instances that exaggerated numbers and overall inaccuracy in the way data is reported by up to 95 percent.
Ripple are looking to address this by taking steps to increase the overall reliability of market structure and reporting at digital asset exchanges worldwide.
A major concern
The fact that there is this well-known over exaggeration of volumes is both concerning and damaging for the cryptocurrency ecosystem. One of the world’s biggest regulators has reported on it, in the SEC, and it has made them skeptical of the industry.
It leads to falsehoods for investors when using different exchanges, and it also boosts the value and worth of certain coins – as Ripple have noted.
Taking a hit
Ripple have admitted by trying to address the falsehoods of volume reporting they expect to take a hit in their own Q2 forecasting by as much as 50 percent.
“While we aren’t claiming to have an exact solution, we are taking steps at Ripple to address these concerns and the questions they raise about the overall reliability of market structure and reporting at digital asset exchanges worldwide,” Ripple reported.
“We are actively working with trusted partners in the space to better understand the scope and scale of the problem. We are evaluating our approach to XRP volume reporting, including reviewing new options and requirements for sourcing market data.”
“We are taking a more conservative approach to XRP sales this quarter.”
A big drop
In the short term, this means Ripple’s sales of XRP in Q2 2019 will be substantially lower. Their stated target of 20bps for programmatic sales of XRP volume, as reported by CoinMarketCap, will likely drop to less than 10 bps.
Longer term, by being more demanding about their expected standards for market structure and reporting, Ripple are hoping to begin raising the bar industry-wide.