The XRP Ledger (XRPL) witnessed an impressive 113% growth in daily transactions in Q1 2024, reaching 2.7 million.
Crypto analytic firm Messari disclosed this figure in a new study detailing the network dynamics of XRPL for the first quarter of the year. The study indicates that the XRPL experienced a surge in network activity by almost every metric during Q1.
Active Addresses and Txn Increased 37% and 113% QoQ
The most prominent positive metric was the average daily transactions and active addresses. Specifically, daily transactions averaged 1.3 million in Q4 2023. However, the number increased by 113% to 2.77 million in Q1 2024.
Similarly, while the average daily active addresses were 30,000 in Q4 2023, the figure increased by 37% to 41,000.
Activities Influenced by Inscriptions
The report pointed out that a significant portion of the transaction activity stemmed from a limited number of accounts sending transactions to a single recipient. Messari’s analysis revealed that over 30 million transactions were directed to one account by a cluster of approximately 45,000 accounts. Notably, these were for activities related to inscriptions.
Significantly, inscriptions are NFT-related transactions that gained popularity on the Bitcoin network in early 2023. While they started with the Bitcoin network, inscriptions have since emerged on nearly every major network. They sometimes lead to network outages due to the sheer volume of activity.
On December 31, 2023, XRPL reached a peak activity level of over 80 transactions per second sustained throughout the day, with 6.9 million transactions. The report credited XRP Script as the driving force behind the bulk of the inscription activity on the network.
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Interestingly, Messari noted that XRPL suffered no network disruptions during the peak inscription activities of December.
New Wallet Creation Decreased QoQ
Furthermore, the report revealed that the net count of XRPL accounts rose by 150,000, pushing the total number of accounts up by 3.1% to 5.15 million in the first quarter.
However, XRPL witnessed a 12.4% quarter-over-quarter reduction in the creation of new addresses. The report attributes this quarterly decline to the abnormally large number of addresses generated in Q4 2023.
Regarding the year-over-year growth, XRPL registers a 29.8% increase in new addresses from Q1 2023 to Q1 2024. Moreover, there was a 55.9% rise in account deletions quarter-over-quarter, totaling 33,000 and coinciding with the decline in inscription activity.
The significance of account creations and deletions on XRPL is unique compared to most networks because accounts necessitate a deposit for creation. This initial deposit is recoverable upon account deletion.
Accordingly, Messari points out that the account metrics on the XRPL are more indicative of genuine activity, as opposed to other networks where creating accounts can be done en masse at no cost, leading to potential spam or Sybil attacks.
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