Stellar (XLM) – What You Should Know Before You Buy It

The Stellar network is an open-source, distributed, and community-owned system used to ease cross-asset transfers of value. Its aim is to help facilitate these transfers at a fraction of a penny while trying to be an open financial system that offers people of all income levels access to affordable services.

Using the platform’s intermediary currency, Lumens (XLM), an individual can send any currency they own to anyone else in a different currency. Stellar is also a payment system that aims to connect financial institutions and significantly reduce the cost and time needed for cross-border transfers.

Benefits of XLM

Stellar aims to be a blockchain network that provides financial access to people in all regions of the world, more so those in the unbanked and underbanked areas. The major benefits of XLM are the low transaction fees, fast transaction speeds for cross-border transfers, and tight security.

Is XLM a Fork of XRP (Ripple)?

Because of the similarities between these two cryptocurrencies, some people assume that XLM is a fork of XRP (Ripple’s token). However, the consensus protocol of the two networks is rather different – while Ripple relies on voting, with transactions approved by over 80 percent of the nodes, XLM allows its nodes to become validators.

Moreover, the two differ in their target audience. XRP is known for offering services to banks and other financial institutions, while XLM focuses on providing transfer services to individuals.

How Does XLM Work?

XLM runs on the Stellar Consensus Protocol, which is a decentralized network of peers that operate independently. The decentralized servers system on the blockchain syncs and reaches consensus, creating the network and enabling the ledger to be divided evenly and as widely as possible.

The Stellar Consensus Protocol allows the network to reach better speeds and be more efficient in comparison to most blockchains operating on Proof-of-Work (PoW) consensus protocols.

Stellar uses what we know as ‘anchors,’ which are entities that people trust to take care of their deposits and distribute credits into the blockchain for the deposits made. The anchors operate as bridges between various currencies and the Stellar blockchain. All the transactions carried out on the Stellar network, besides XLM transactions, are performed in the form of a credit issued by the anchors.

The anchors on the blockchain help with currency transfers; for instance, if you want to send USD for EUR and there are no available trading pairs, the network will trade the USD for XLM and then trade the XLM for EUR. If this option is difficult to process, the network will consider another option – it could exchange the USD for Bitcoin (BTC), then the BTC for XLM, and then the XLM for EUR. Overall, the network always finds the friendliest and fastest way to facilitate the transfers.

How to Buy and Store Lumens (XLM)

To use the Stellar network, you need XLM. Fortunately, the crypto coin can be purchased from various cryptocurrency exchanges and is also available for trade directly on the Stellar blockchain.

After buying XLM, we don’t recommend you to keep them on the cryptocurrency exchange because such platforms are relatively vulnerable to attacks. Rather, you can store them on hot or cold wallet storage units such as Ledger or Trezor. After storing your XLM, make sure you keep your private keys safe so that you don’t lose access to your wallet permanently.

The Bottom Line

Stellar Lumens (XLM) is one of the top cryptocurrencies by market capitalization. It is a popular digital asset that helps facilitate cross-border transfers. Still, unlike Ripple, which focuses on banks and other financial institutions, the Stellar network offers its services to individuals. The Stellar network also facilitates rapid and safe cross-border transfers with low transaction fees.

SEC Update — Preliminary Ripple Response


Here’s the note I sent to Ripple employees today regarding Ripple’s preliminary legal response to the SEC’s complaint.

Hi Ripple team,

Since the SEC filed its complaint at the end of December, its side of the story has been the only one shared publicly. Our initial response was finally filed today. The “Answer” is a legal document (filed publicly) which, as the name suggests, is our official answer to the allegations in the SEC’s complaint. Although it does not fully outline our strategy (more to come as it plays out in court) it’s our first opportunity to start to set the record straight.

Although the legal process is slow, we are working to get this resolved as quickly as possible to bring clarity to the broader market. Moving quickly is important because, as you know, since the SEC filed its complaint, XRP lost almost half of its market value, causing retail holders of XRP with no connection to Ripple– the very people the SEC purports to protect – to suffer billions of dollars in losses. What’s more, part of the SEC’s mission is to maintain orderly markets… and yet their overreach created havoc in the market.

The “Answer” is a long legal document, but I’ll summarize the main points below. It looks similar to the summary of our Wells Submission, which some of you have probably read. 

XRP Is Not an Investment Contract

The only question in this case is a technical one: whether or not Ripple’s limited distributions of XRP were an investment contract. To be clear, there are no allegations of fraud, misrepresentation, etc. While we’ve seen some Twitter commentators suggest this is a non-fraud/fraud case, a first year law student can tell you that there is no such thing. It’s misleading and irresponsible (not to mention silly) to even suggest otherwise. Turning to what matters…. 

In our “Answer,” we explain why there is no “investment contract” :

  1. XRP is a virtual currency and thus, outside the SEC’s jurisdiction.
  2. Ripple has never entered a contract for an investment with any holders of XRP. 
  3. Ripple never held an ICO, never offered future tokens to raise money and has no relationship with the vast majority of XRP holders.
  4. Holding XRP does not mean a person receives a portion of Ripple’s revenue or profits.
  5. Ripple’s XRP sales amounted to far less than 1% of the massive XRP market that has grown over the last 8 years. 
  6. The XRP Ledger, on which XRP actually moves, is completely decentralized. The SEC ignores the economic reality of an XRP transaction. 
  7. Ripple’s XRP holdings do not create an investment contract any more than DeBeers holdings convert diamonds into securities.  

The SEC Is Out of Step Domestically and Globally

Before this case, no securities regulator in the world has claimed that transactions in XRP must also be registered as securities, and correctly so. The functionality and liquidity of XRP are wholly incompatible with securities regulation. Requiring XRP’s registration as a security would impair its main utility.

In fact, regulators in the US government (the Department of Justice and FinCEN) determined in 2015 and 2020 that XRP is a virtual currency and have since regulated it as such. Basically, on its way out, the Trump administration sought to undo the determination that XRP was a virtual currency made during the Obama administration.

Globally, the same is true of regulators – the UK’s Financial Conduct Authority, and regulators in Singapore and Japan have concluded XRP is a virtual currency or a crypto asset, and not a security. With its complaint, the SEC is asking the Court to contradict the findings of the agency’s peers in the US and worldwide. 

The SEC Is Picking Winners and Losers

Although XRP is the most efficient digital asset for global payments benefiting consumers around the world (and is the most environmentally sustainable crypto), there is no principled distinction between XRP’s current function and that of BTC or ETH. How does the SEC explain telling the public that BTC and ETH are not securities, then turning around and alleging the opposite is true for XRP?

What’s particularly interesting here is that at one point, the SEC claimed that ETH might have been born a security, but eventually evolved into a non-security, offering no guidance or framework for this determination. We’re just asking for the rules to be stated clearly and for those rules to be applied consistently across the board. We sent a FOIA request to the SEC asking for more information about how the determination was made, in hopes of gaining more clarity on how they came to the initial conclusion about ETH.

Furthermore, XRP is a great deal more environmentally friendly than BTC and ETH, considering it avoids the mining process. The power needed to mine and validate BTC transactions leaves an enormous carbon footprint, compared to the modest amount of energy consumed by XRP transactions. That must matter from a policy perspective. 

The SEC Has Distorted the Facts

The complaint filed by the SEC is full of cherry-picked quotes taken out of context, and draws conclusions that are unsupported by both the facts and the law. Through our response we start to clarify the record. While we can’t get into all of the specifics in this format (that will happen as the case progresses), you’ll see we denied many of the SEC’s  allegations. In time you will see why.

I’ll share a quote from one of our outside counsel with his evaluation of the case – I think summarizes the situation quite well:

“The SEC’s case is unprecedented and ill-conceived. The SEC has ignored XRP’s clear status as a virtual currency, contradicting not only the findings of other U.S. regulatory agencies, but also international regulatory regimes. Over the last eight years, the XRP market, independent of Ripple’s activities, had grown to a massive scale- trading on over 200 exchanges worldwide. The SEC is now stretching the concept of an “investment contract” beyond its breaking point. We look forward to presenting our case in Court.” Andrew Ceresney, Debevoise & Plimpton

I want to thank Team Legal for all of their hard work on this – and, on behalf of Brad, recognize the broader Ripple team for staying focused on executing against our vision while we take this case to the courts. 




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bKash and Mobile Money Connect Through RippleNet To Power Wallet-To-Wallet Remittances


Today, we’re thrilled to announce our partnership with Mobile Money, a Malaysian mobile wallet company. Through RippleNet, Ripple’s global payments network, Mobile Money has connected to bKash, Bangladesh’s largest provider of mobile financial services (MFS) which serves over 45 million users. The partnership will power seamless wallet-to-wallet payments to serve the remittance corridor between Malaysia and Bangladesh. 

bKash and MobileMoney will gain access to a wide range of RippleNet’s features, including wallet-to-wallet transactions. Mutual Trust Bank (MTB) will work as the local banking partner in Bangladesh to perform the remittance settlement under the purview of Bangladesh Bank and ensure a seamless payout experience.

Bangladesh has the third largest remittance flows in South Asia, and the eleventh largest worldwide, with Malaysia ranking as one of the top five sources of remittances for Bangladesh. Through this partnership, Mobile Money is also anticipating an increase in its user base of Bangladeshi workers by 20% as it enables them to better serve their user base. 

”We are constantly exploring innovative ways to give simple solutions to our customers. bKash is happy to have partnered with Ripple in collaboration with Mutual Trust Bank of Bangladesh to deliver a cost effective, fast, transparent and reliable remittance sending experience to more than 10 million non-resident Bangladeshis all over the world. This partnership will bring great convenience to both the recipients and senders, and contribute further to our national economy by encouraging inward foreign remittance flow through legal channels,” said Kamal Quadir, CEO of bKash.

“Our focus has always been on providing simple, cost-effective and convenient e-payment solutions to our customers. More than ever, the pandemic has demonstrated that there is a strong need for remittance solutions that enable people to transfer money anytime and anywhere. Our partnership with Ripple makes us one of the first few e-wallet companies to offer such digital remittance solutions to Bangladeshi workers, and we’re confident that it will enable us to stay ahead of the competition, while expanding our user base,” said Lee Eng Sia, Founder of Mobile Money.

Syed Mahbubur Rahman, Managing Director & CEO of Mutual Trust Bank added, “We look forward to enabling wallet-to-wallet remittances from Malaysia to Bangladesh in real-time by partnering with bKash and Ripple. Last year, Bangladesh remittances reached an all-time high of 18.2 billion U.S. dollars with the majority of these remittances coming from Malaysia, Middle Eastern countries and the US.”

“Ripple is keen to bring greater connectivity and convenience for the Bangladeshi population, and provide them with a more streamlined, frictionless cross-border payment experience,” said Navin Gupta, Managing Director of South Asia and MENA. “As Ripple is bolstering our presence in South Asia, we are excited to contribute to the infrastructure of the region to transform the way cross-border payments are executed.”

RippleNet leverages distributed ledger technology to deliver financial solutions — from bi-directional messaging, settlement, liquidity management and lines of credit — to a global network of partners.

If you’re a payment provider looking for the right solution to enable real-time global payments and want to learn more about RippleNet, contact us.


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Accelerating Financial Inclusion Through Technology


I believe that technology, when built and scaled right, can have a profoundly positive impact on humanity and improve people’s lives. In leading engineering teams at Amazon for 15 years, I witnessed first hand, customer focused innovations at scale that provided people with core necessities essential to how they live. With the global pandemic, it has become more apparent that we are  able to fulfill a critical role for communities around the world and help them feel secure during an uncertain time by delivering essentials to their doorsteps.

When I consider the standout companies and industry leaders of the 21st century, it’s hard not to think about the journey that enabled this scale and one of the key technological developments behind each of these stories — the internet. 

There are several parallels in Ripple’s vision to enable the Internet of Value (IoV) – a world where money moves like information on the internet. By building the heavy lifting infrastructure, it has the potential to not only create new opportunities in business but to impact billions of people and their daily lives. Just as the internet was the driving force behind many of today’s  leading companies, blockchain has the potential to fundamentally change our current financial system and bring billions of unbanked people into the financial ecosystem and accelerate financial inclusion globally. 

Over the past several years, financial institutions have shifted their strategic focus to offering delightful customer experience as their key to success. However, the current global payments infrastructure does not meet today’s business or consumer demands. For instance, the cost of remittances remains high and it underscores the gaps that exist in the current financial system where those who have the least, often pay the most. 

On average the fee to send $200 is $14. For someone living on $200, putting that money back into their pocket isn’t just an added bonus — it can be life-changing. Ripple’s financial  network RippleNet, and the RippleX open developer platform  unlock the power of blockchain and digital asset technology allowing financial institutions, startups, founders and entrepreneurs to dramatically improve the speed, cost and reliability of how people transact around the world.

One of the most important lessons that I carry with me from my time at Amazon is the idea of “divine discontent” when it comes to serving customers. Customers’ expectations and insistence on the highest standards remains constant in an ever changing world. In any role or in any new project, I look to first deeply understand the customer. Once you understand the customer needs, challenges and their heartbreak it’s impossible to stay quiet. This understanding  is key to acting boldly to overcome insurmountable challenges and addressing unmet customer needs from building a better product to advocating for them in the boardroom.

Teams and companies that inherently know this and are able to put it into practice each day are the most successful. They don’t rest on their laurels, they remain humble and vocally self-critical with a love of learning. 

I believe in order to deliver complete solutions for customers, teams must have customer obsession, engineering strength, invention strength and operational rigor. At its best, technology serves as the backbone for innovative solutions at a global scale. When technology is agile and scalable, it can drive invention and help realize the strategic vision. When it’s not, it will slow down innovation and create inertia. 

Ripple’s engineering team has set a high standard of engineering quality to gain the confidence of global customers. The potential of this technology is far-reaching and in many ways, we are only at the beginning. 

I view engineering as a strategic member of the product and business teams, helping to build architecturally sound systems aligned with customer and business needs. These principles are ones I bring with me into my new role, and ones that I’ve already seen at play in my short time at Ripple. 

By leveraging cutting-edge technology with blockchain and digital asset technology, Ripple is solving real problems that impact everyone, everywhere. 

Industry leading technology, Rapid growth and scale makes for an unpredictable path. As a team, we keep learning and getting better at being prepared for whatever comes next. Despite the sometimes unpredictable terrain, our team remains laser focused and are confident that we will come out stronger on the other side. There is no roadmap for where we’re going, we enjoy the journey. Innovation is part of our DNA!

Designed and custom-built by Ripplers, our product innovations use a variety of technologies including front-end to highest scale backend services, blockchain, data platform and advanced machine learning.

We’re looking for builders to help us innovate the future globally. Check out Ripple’s Careers page.


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Our Statement On Recent Market Participant Activity


The public and press have only heard the story from the SEC’s side, and we’ll be filing our response in a few weeks to address these unproven allegations against Ripple.  

The SEC’s decision to file this action is not just about Ripple, it is an attack on the entire crypto industry here in the United States. We’ve always said that there is a dangerous lack of regulatory clarity for crypto in the U.S. — their lawsuit has already affected countless innocent XRP retail holders with no connection to Ripple. It has also needlessly muddied the waters for exchanges, market makers and traders. The SEC has introduced more uncertainty into the market, actively harming the community they’re supposed to protect. It’s no surprise that some market participants are reacting conservatively as a result.

In the meantime, Ripple will continue to operate and support all products and customers in the U.S. and globally. The majority of our customers aren’t in the U.S. and overall XRP volume is largely traded outside of the U.S. There are clear rules of the road for using XRP in the UK, Japan, Switzerland and Singapore, for example. For eight years, we’ve built products that help hundreds of customers solve pain points around global payments — we will defend our company and look forward to settling this matter in court to finally get clarity for the U.S. crypto industry.

On a parallel note, we also look forward to working with all of the Commissioners and the SEC’s new leadership, once appointed. In all, the SEC Chair, six of his Directors from each SEC Division, the SEC’s Chief Economist and the SEC’s General Counsel have now departed (many left just last week). Our steadfast commitment to constructive regulatory engagement has not changed. 


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The SEC’s Attack on Crypto in the United States


Here’s the note I sent to Ripple employees yesterday – we remain confident after reviewing the SEC’s complaint today that we are on the right side of the law and of history.

Also – more reaction to today’s filing from our lawyers: 

  • “The SEC is completely wrong on the facts and law and we are confident we will ultimately prevail before a neutral fact-finder. XRP, the third largest virtual currency with billions of dollars in trading every day, is a currency like the SEC has deemed Bitcoin and Ether, and is not an investment contract. This case bears no resemblance to the initial coin offering cases the SEC has previously brought and stretches the Howey standard beyond recognition.” Andrew Ceresney, Debevoise & Plimpton
  • “This complaint is wrong as a matter of law. Other major branches of the U.S. government, including the Justice Department and the Treasury Department’s FinCen, have already determined that XRP is a currency. Transactions in XRP thus fall outside the scope of the federal securities laws. This is not the first time the SEC has tried to go beyond its statutory authority. The courts have corrected it before and will do so again.” Michael Kellogg, Kellogg, Hansen, Todd, Figel & Frederick

Hi Ripplers,

In my 5+ years at Ripple, I’ve seen an incredible amount of progress, innovation and growth. This year alone, we’ve brought to market new products and features leveraging XRP, like Line of Credit, enabling a better payments experience for our customers – and their customers. Interestingly enough, after all these years, it’s the two things that have NOT changed that stand out to me the most: 1) our vision, the Internet of Value and 2) the fact that XRP is a currency, and not a security. It’s unequivocally the best digital asset for payments. As you read on, know that today, maybe more than ever, I continue to vehemently believe this. 

We’ve always said that there is a lack of regulatory clarity for crypto in the US, and the SEC here in the United States has sat back and watched for years. In fact, the discussion around why XRP is a currency (and not a security) is one we have been having with the SEC for nearly three years and yet we’ve never been met with clarity. We have, however explained that XRP is not a security because, among other things:

  1. XRP is not an “investment contract.” XRP holders do not share in the profits of Ripple or receive dividends, nor do they have voting rights or other corporate rights. Purchasers receive nothing from their purchase of XRP except the asset. In fact the vast majority of XRP holders have no connection or relationship with Ripple whatsoever.  
  2. Ripple (our company) has shareholders; if you want to invest in Ripple, you do not buy XRP but rather shares in Ripple.
  3. Unlike securities, the market value of XRP has not been correlated with Ripple’s activities. Instead, the price of XRP is correlated to the movement of other virtual currencies.

As you all know, we have always tried to over-communicate, be as transparent as possible, and explain how we think about the long-term value of XRP. We have always worked to partner with regulators. We have proactively partnered globally – and even here in the US, cooperating and acting in good faith with the SEC. Even while these conversations have dragged on, we were ready and willing to continue the dialogue. Unfortunately, in this lame duck status as Chairman Jay Clayton exits, he has decided to make very serious allegations, which suggest that Ripple, Chris Larsen and I have violated the Securities Act. I expect the SEC will share that filing publicly in the next couple of days, so I wanted to give you all a heads up. You should also know and expect that the SEC will likely do everything they can to paint Ripple, Chris and me in the worst possible light – quotes could be taken out of context, personal details may be shared, etc.  

To be clear, this is all based on their illogical claim that XRP is, in their view, somehow the functional equivalent of a share of stock. What’s more, for them to say that XRP has been a security all along and that Ripple, Chris and I should have known makes absolutely no sense… particularly when the US Treasury and US Department of Justice have long ago concluded that XRP is a currency. Our entire AML/BSA compliance program is built on the fact that XRP is a currency! When you marry this with the fact that many other G20 governments call XRP a currency, it is truly confounding that the SEC would take this step. 

Chris and I had the option to settle separately. We could do that, and it would all be behind us. NOT happening. That’s how confident Chris and I are that we are right. We will aggressively fight – and prove our case – through this case we will get clear rules of the road for the industry here in the U.S. We are not only on the right side of the law, but we will be on the right side of history. 

Let me be clear: Ripple, Chris and I may be the ones named in the filing, but this is an assault on crypto at large. In this case, XRP is a proxy for every other ‘alt-coin’ in the space. From there, you have a snowball effect; this isn’t good news for any market maker, exchanges like Coinbase, etc. This sets a terrible industry-wide precedent for any company working with a digital asset. With this allegation, coupled with the SEC’s “good housekeeping seal of approval” bestowed upon ETH and BTC only (directly benefiting China), they’re creating an unfair advantage to companies here in the US – and dramatically benefiting BTC and ETH. It’s just incredible that the SEC, a U.S. regulator is in the business of picking winners in this industry (or really any industry) and disadvantaging companies here in the US. 

Interestingly, Jay Clayton has been incredibly focused on showing a legacy of supporting innovation. Despite what he would like the public to think, it’s obvious the SEC is not at all committed to fostering innovation in the digital asset space. With this behavior, the SEC is engaged in an all-out attack on the crypto industry. That will be Jay Clayton’s true legacy. 

It’s incredibly frustrating. There’s a massive opportunity up for grabs to be the global leader and win this new technological and economic cold war. Instead, the SEC is way out of step with what other governments are doing, ignoring the very positive macro trendline and incredible potential (and existing utility) of crypto. The crypto industry can and will thrive – but this will push innovation outside of the US. It’s very interesting, but not surprising, that the lame duck Trump administration is making consequential decisions that will jam up the Biden administration… which will increase the focus on consumer protection and transparency. The timing is really quite remarkable. 

Like I said, I think the claims are misguided and defy basic logic. Regardless, I’ve obviously never had an assertion like this before, and am taking it very seriously. I hope that you all understand the gravity of the situation too.

What I DON’T want is for you to worry. We will get through this, and we will prove our case in court. We have a phenomenal legal team and like I said, we are on the right side of the law to begin with. Know, however, that the legal system is slow, and this is just the beginning of a long, civil process. 

No matter what twist and turns are ahead, we will stand by our employees, shareholders and customers. It’s still business as usual – we need to stay focused and continue to deliver the value that hundreds of customers around the globe have come to expect from Ripple. Although the SEC’s decision brings an even greater sense of urgency to our decision whether to move our HQ outside the US, we also look forward to working with the new Biden administration to see if we can find a rational path forward here. 

Nothing will fundamentally alter our trajectory. We are extremely fortunate to be in a position that we can fight this, and aggressively defend our company, this team, our products and – at a fundamental level, the industry as a whole. 



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Our Commitment To Combating Food Scarcity With Eat. Learn. Play.


Ripple employees help distribute food, gifts and essential resources at the 8th Annual Eat. Learn. Play Christmas with the Curry’s.

Food insecurity has dramatically increased for millions of Americans in the wake of job losses, business closures and overdue rent payments brought about by the impact of the pandemic. 

In the Bay Area, one in four kids is currently affected by hunger and food insecurity, including at least 18,000 children who rely on school meals for their daily nourishment. Those numbers are even more staggering in Oakland where nearly 30% of children face food insecurity. Meanwhile, the restaurant industry—which sustains 15.6 million jobs as the nation’s second-largest employer—has been decimated, creating an unprecedented challenge in our community.  

In an effort to help close this gap, Ripple is proud to announce a $1 million gift to Eat. Learn. Play.—a non-profit founded by Stephen and Ayesha Curry to fight childhood hunger. To date, the partnership has allowed Eat. Learn. Play. to achieve its goal of reaching more than 130 local restaurants and provide more than 15 million meals, 2.5 million of which were prepared and distributed by the restaurants.  

Ripple’s contribution has also helped save food service jobs and keep restaurants in Oakland open through World Central Kitchen, a non-profit that provides fresh meals to those in immediate need and sustains small businesses and local restaurants in the midst of the humanitarian crises. 

“In partnership with Ripple, our program has engaged more than 100 Oakland restaurants, helping to save the jobs of 850 restaurant workers and prepare more than 2.5 million nutritious meals for food-insecure families,” says Chris Helfrich, President and CEO of Eat. Learn. Play. “Our work together is far from over, and we’re committed to helping individuals and families across the Bay Area in every way we can.”

Most recently, Eat. Learn. Play. hosted its annual Christmas with the Curry’s where Stephen and Ayesha Curry, along with volunteers from Ripple and other community partners, surprised approximately 1,000 low-income families from Alameda County with a holiday drive-thru distribution of food, gifts and essential resources. In partnership with World Central Kitchen, Ripple supplied local, family-style holiday meals and boxes of fresh, farm produce, a central feature of the drive-thru distribution.

As a mission-driven company with employees and customers around the world, Ripple is committed to helping communities impacted by the pandemic. Our continued partnerships with local meal providers and food banks have allowed us to provide meals for food-insecure families across San Francisco, Marin, Alameda, Santa Clara and San Mateo counties. 

To learn more about Ripple Impact, visit www.ripple/com/impact. 

Stephen Curry attends Eat. Learn. Play., the 8th Annual Christmas with the Curry’s hosted by Co-Founders Stephen and Ayesha Curry at Oakland Arena on December 19, 2020 in Oakland, California. (Photo by Noah Graham/Getty Images for Eat. Learn. Play.)


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Ripple Adds Sandie O’Connor To Board of Directors


Today, Ripple is thrilled to announce that Sandie O’Connor is joining its Board of Directors. O’Connor has over 30 years of leadership experience with a deep background in finance, treasury, capital markets and regulatory affairs. As Ripple expands its global network and continues to push for regulatory clarity in the United States, she will provide counsel on key government relations and regulatory initiatives in the company’s next phase of growth.

“Sandie is extremely well-respected by her peers on Wall Street and the regulatory community alike. Her extensive network and in-depth understanding of markets, capital flows and banking will provide valuable and unique insights as new policies and regulations take shape across the U.S.,” says Brad Garlinghouse, Ripple CEO. “The U.S. needs a single clear regulatory framework for crypto that levels the playing field and supports American innovation and companies. Sandie’s experience and guidance will support us on our journey to building a more inclusive financial system.”

O’Connor recently retired as the Chief Regulatory Affairs Officer for JPMorgan Chase where she set the firm’s comprehensive regulatory strategy and led engagement with G-20 regulators and policymakers regarding evolving regulation. Prior to this role, O’Connor held several senior leadership positions at the firm, including Global Treasurer and head of Prime Services, and served on multiple firm-wide governance committees including Risk and Capital. O’Connor joined JPMorgan in 1988 and over a 30-year career, held positions of increasing responsibility within the company’s Investment Bank and Corporate divisions.

“Ripple is reshaping the financial landscape solving inefficiencies with today’s payments infrastructure using digital assets and blockchain technology,” said Sandie O’Connor. “The opportunity for the market has never been bigger, and I’m thrilled to bring my experience working with leaders in developing regulatory policy to support the evolution of the payments ecosystem and promote financial access and inclusion.”

O’Connor currently serves on the board of Terex Corporation (NYSE:TEX) and as current Chair of the YMCA of Greater New York. She has been named to American Banker’s top 25 lists of the Most Powerful Women in Banking and Finance several times. O’Connor serves on a Task Force on Financial Stability, and on Advisory Committees for the Office of Financial Research and FDIC Systemic Resolution.


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Q3 2020 XRP Markets Report


Ripple publishes the quarterly XRP Markets Report to voluntarily provide transparency and regular updates on the company’s views on the state of the XRP market, including quarterly sales updates, relevant XRP-related announcements and commentary on previous quarter market developments. 

As an XRP holder, Ripple believes proactive communication and transparency are part of being a responsible stakeholder. Moreover, Ripple urges others in the industry to follow its lead to build trust, foster open communication and raise the bar, industry-wide.

On-Demand Liquidity (ODL): Introducing Line of Credit

Last quarter, Ripple launched Line of Credit, a new beta service on RippleNet that allows customers using On-Demand Liquidity (ODL) to source capital on-demand. With Line of Credit, customers can purchase XRP from Ripple on credit which provides capital upfront to help accelerate their business performance and scale. Line of Credit has been piloted by ODL customers and the initial feedback is overwhelmingly positive. Companies can use the capital to further invest in their business to enter new markets and reach new customers. 

In some instances, XRP originates through Ripple, instead of an exchange, to initiate cross-border payments at scale. ODL will evolve as Ripple continues to provide innovative, financial solutions that leverage XRP to solve pain points for its customers.

XRP Purchases

As indicated in the Q2 2020 XRP Markets Report, Ripple is purchasing – and may continue to purchase – XRP to support healthy markets. This is a near-term product solution for the Line of Credit beta. Long-term, Ripple is building new ODL capabilities to dynamically source XRP liquidity from the open market, not just Ripple.

Disciplined, Responsible Stakeholders: Q3 Sales and Purchases 

Last quarter, total XRP sales, net of purchases, were $35.84 million (USD) vs. $32.55 million the previous quarter. Ripple focused solely on its over-the-counter (OTC) sales and leases as part of providing increased XRP liquidity to certain RippleNet ODL customers to improve their ODL experience, eliminating the need for pre-funding and enabling instant global payments. Similar to recent quarters, Ripple did not sell programmatically.

Total sales, net of purchases, ended the quarter at 10 bps of CryptoCompare TopTier volumes. This is compared to total sales in the previous quarter of 18 bps of CryptoCompare TopTier.

Sales Summary (dollars in millions) Q2 2020 Q3 2020
Total ODL-related sales* 32.55 81.39
Total purchases 0 45.55
Sales (net of purchases) 32.55 35.84
Global XRP volume Q2 2020 Q3 2020
ADV XRP (dollars in millions) 196.28 403.58
Total XRP volume (dollars in billions)** 17.86 37.13
Net sales as % of total volume 0.18% 0.10%

*ODL-related sales include XRP sales to support ODL (including Line of Credit) and key infrastructure partners 

**Note: Figures were compiled using the CryptoCompare API for daily TopTier aggregate volumes which reflects total XRP volume in dollars by exchanges that CryptoCompare lists in the TopTier as of the end of Q3. Ripple continues to evaluate its benchmarks given challenges, such as fake volume, that continue to persist in the industry.

Certain wallets that are being used for XRP sales also provide short term leases to market makers. This is worth noting given that this is often mischaracterized by market participants as sales. Leases are ultimately returned to Ripple.

Reported Volume

CCTT’s reported daily volume for XRP increased in Q3 2020 from Q2 2020. The average daily volume reported at $403.58 million in Q3 versus $196.28 million in Q2.


XRP’s standard deviation of daily returns over Q3 was 3.5%, representing an increase in volatility from Q2’s 3.0% and Q1’s 6.2%. XRP’s volatility over the quarter was higher than that of  BTC (3.2%) and ETH (3.3%).


In Q3 2020, three billion XRP were released out of escrow (one billion each month). In total across the quarter, 2.4 billion XRP were returned and subsequently put into new escrow contracts. For more information on the escrow process, see here. Note: All figures are reported based on transactions executed during the quarter.

XRP Integrations and Liquidity Update 

XRP Integrations

Last quarter saw the continued evolution of XRP infrastructure. FTX integrated the XRP/USD spot listing and began accepting XRP as collateral for all derivatives. Among top crypto exchanges, FTX now holds the largest market share of XRP open interest.

Data sourced 10/03/2020 06:00 AM UTC

In addition, other notable launches include:

  • Binance launched XRP/USD inverse perpetual swap collateralized in XRP. On its app, Binance launched XRP put, call and straddle options (long only) as well as leveraged tokens XRP up and XRP down.
  • Flare announced the launch of a smart contract platform for XRP through a “utility fork” and making Spark (their token) claimable by certain existing XRP holders. This is positive for the XRP community as it allows developers to create smart contracts for new use cases like lending and derivatives, extending XRP’s utility.

Liquidity and Volume

As for overall liquidity and volume, XRP ended the quarter as the 4th most traded digital asset, moving up from its ranking of 5th place last quarter.

XRP: A Preferred Base Currency for Arbitrage Trading

XRP allows traders to capture time limited arbitrage opportunities that they otherwise would not be able to with other digital assets. XRP’s speed, low transaction costs and reliability are ideal for a currency for market makers and traders to capture more price differences between exchanges. It also reduces the exposure to the various risks involved in those arbitrage trades.

For example, using XRP as a bridge currency across trading venues allows traders to substantially reduce the time needed to do so, and more importantly the related volatility exposure when compared to other digital assets, such as BTC and ETH. This is clearly demonstrated in the chart below of an asset transfer over $10,000 USD equivalent in BTC, ETH and XRP originating from Binance to Coinbase.

Data sourced 10/03/2020 06:00 AM UTC

In fact, the inter-exchange transfer-time for XRP across a selection of major exchanges can go as low as 18 seconds (Bitstamp to HitBTC) where exchange withdrawal times are lowest. 

Data sourced 10/03/2020 06:00 AM UTC (originating exchange left / destination exchange top)

XRP Ledger 

XRP Ledger Foundation

The XRP Ledger Foundation, an independent and non-profit entity, launched to support the development and adoption of the decentralized XRP Ledger. Ripple, along with Coil and Gatehub, provided an initial donation to help support the Foundation’s work and serve the growing developer community building on the XRP Ledger. The Foundation’s vision is to accelerate the development of a healthy XRP Ledger ecosystem that encompasses the involvement of developers, public and private enterprises and social initiatives focused on financial inclusion and sustainability,


As the world makes a transition to a clean energy future, addressing sustainability across all industries has emerged as a global priority to drive future economic growth – global finance is no exception. In fact, last week, the NYDFS published an open letter to NY Supervised Financial Institutions on climate change, highlighting the potential environmental impact of cryptocurrency mining, specifically the high energy consumption from mining BTC.

Ripple partnered with leading technology and conservation organizations, such as Energy Web Foundation and XRPL Foundation, to ensure all blockchains can become carbon neutral—starting with the XRP Ledger.

XRP is extremely energy efficient by design, with transactions settling without the enormous energy costs associated with proof-of-work mining required by other blockchain based transactions. In fact, for every 1 million transactions, BTC uses power equivalent to 4.51 billion lightbulb hours compared to XRP, which uses power equivalent to 79,000 lightbulb hours. This means that the energy consumption of XRP is 57,000x more efficient than BTC.

Lastly, the release of XRP Ledger v1.6 introduced new features and improvements such as a more robust consensus mechanism and the Negative UNL amendment on devnet to test reliability, stability, performance and security.

Market Commentary 

Crypto as an Inflation Hedge 

With central banks printing increased amounts of fiat currencies and federal governments passing record levels of fiscal stimulus, inflation concerns gripped the financial markets. Dollar debasement fears began to drive market narrative, leading to 18-month lows in the DXY, and record highs in Gold and Silver. As investors looked for ways to preserve their wealth in supply-limited assets, money naturally flowed into the crypto markets, driving BTC above the 12k mark for the first time in nearly a year. 

Continued Institutional Adoption

Institutional demand has been increasing over the past year, and Q3 was no exception. Financial giants such as Standard Chartered Ventures announced the pilot of a custody solution and Fidelity is doubling down on its commitment to the space with the launch of a BTC fund. Notably, Grayscale BTC trust experienced colossal growth which now controls 2.4% of all BTC in circulation. MicroStrategy, a NASDAQ listed technology company, announced the purchase of over $425M of BTC during the quarter, marking the entrance of public companies in crypto investing.

Rise of Decentralized Finance

DeFi dominated in July and August of 2020, with the total value locked up in the space rising sharply from $2B to $11B attracting record volumes. This level of hype led to a self-reinforcing cycle of buying, even on foodie inspired tokens such as Sushi, Hotdog, and Yam. Digital assets with market capitalizations of less than $500M were topping volume rankings on centralized exchanges, regularly outrading top 10 large cap assets. The hype cycle finally peaked in September and the DeFi bubble deflated (not burst), causing most assets in the space to retrace as much as 60% from their highs.


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Creating a More Inclusive Financial System With Crypto


In the latest episode of Block Stars, Ripple CTO David Schwartz talks to Daniel Vogel, CEO and Co-Founder of Mexico’s leading crypto exchange, Bitso.

Mexico’s economic uncertainty and volatile currency means that many Mexicans use US dollars to protect their assets. This is extremely difficult for the one-third of the country’s 125 million people who are unbanked, which explains why Mexico is now one of the world’s fastest-growing crypto markets.

“The big power of crypto is the democratization of access,” says Daniel. “[In Mexico] if you don’t earn over a certain amount of money, you’re just not interesting to [traditional] financial institutions. Crypto solves that problem.”

Though consumers and businesses want to store long-term value in dollars, their day-to-day spending still requires Mexican Pesos. Bitso uses Ripple’s On-Demand Liquidity (ODL) service to ensure customers can move money between currencies quickly and cost-effectively.

“We want to make sure that people can go in and out of crypto…seamlessly using our rails,” Daniel explains. “On-Demand Liquidity is a service that allows fiat currency conversion using crypto technology. In our case, we’re assisting in the conversion of US Dollars to Mexico Pesos where the digital asset XRP is a bridge currency. We’re processing close to 10% of the remittances from the US to Mexico through ODL.”

With more than one million users and an accelerating growth rate over the past year, Bitso is now Latin America’s leading crypto exchanges. But it hasn’t always been easy for the company that Daniel co-founded in 2014, especially given Mexico’s regulatory uncertainty for most of those intervening years.

“It’s been a long journey for us navigating the regulatory landscape in Mexico,” he recalls. “We’ve played a strong hand in shaping it as well. Today, Mexico has a…comprehensive set of regulations if you want to build a crypto business in the country. I am very pleased that we’ve been able to secure meetings with folks at basically every relevant regulatory institution in Mexico or a regulatory agency in Mexico. We have always found individuals in each of those institutions that are willing to listen and who are intrigued by the technology.”

Bitso faces a new regulatory challenge in Argentina where it has recently expanded its operations. Once again, the company is entering a volatile market where people are crying out for a reliable solution. More than 100,000 Argentineans have joined the exchange, turning Bitso into the largest exchange in Argentina after 8 months of launching. Daniel is excited by the opportunity for crypto to make a real difference to people’s lives there, as well as across the rest of the region.

“We believe that in Latin America you have an immediate area of opportunity for building real use cases…because trust in financial institutions is eroded, access is very limited and there’s just a very big need for these financial services and products. We really believe that a radically improved financial system is being created on top of this technology.”

Listen to the latest Block Stars podcast episode to hear more from Daniel on the state of crypto in Latin America, how Bitso almost became a videogames payments specialist and to find out which rock band didn’t have an entry in his parents’ encyclopedia set.


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