Despite the recent crypto market rally that saw XRP record massive daily gains, the latest data from on-chain monitoring firm XRPSCAN suggests that DeFi participants on the network have slowed down as market uncertainty rises.
12,906,712 XRP staked
According to the data provider, the total amount of XRP locked in automated market maker (AMM) pools has declined to 12,906,712 XRP as of May 27.
While AMM pools are mechanisms that allow the provision of liquidity on the XRP Ledger DEX, the decision among XRP users to lock in their funds in the AMM pools signals solid confidence in the token’s potential.
Nonetheless, a downturn in this metric suggests that the interest among investors to stake their tokens has reduced, suggesting that investors are less confident about XRP’s future performance.
Despite this plunge in staking activities, the data further revealed that the total number of active AMM pools providing XRP liquidity has increased to 20,299. This increase in active AMM pools despite the decrease in the total amount of XRP pooled suggests that there is a decent shift in how liquidity is distributed across the network.
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Meanwhile, it also appears that more AMM pools have been created with smaller amounts of XRP in them, possibly due to the increased volatility in XRP’s price or growing fear among investors as market uncertainty looms.
While the reason behind the plunge in the amount of XRP locked across AMM pools cannot be clearly determined, it is attributable to recent price dips experienced by the token.
With the crypto market experiencing mixed price actions amid recurring price corrections, investors are in doubt if there is still more to expect from the third-largest cryptocurrency by market capitalization.
As such, they have taken caution by staking lesser amounts of tokens. According to data from CoinMarketCap, XRP has slowed down on its rapid upsurge and has traded steadily with just a 0.29% increase since the last day.
Notably, XRP is trading at $3.32 as of press time, despite reaching a high of $2.45 five days ago. While the token has maintained resilience above the $2 mark, investors are optimistic about a potential breakout in the price of the token.