Research Shows XRP Beats BNB, Solana, Cardano in Liquidity Ranking

A research report from the institutional-grade analytic platform Kaiko ranked XRP over Binance (BNB), Solana (SOL), and Cardano (ADA) in terms of liquidity.

In a recent tweet, Kaiko recapped its published report that offered a comprehensive liquidity analysis across the top 40 tokens. It challenged the conventional reliance on market capitalization as a key metric and underscored the significance of liquidity in gauging a token’s actual value.

XRP Leads in Liquidity Ranking

In the third quarter liquidity ranking, Bitcoin (BTC), Ethereum (ETH), and XRP emerge as the top three tokens. The report stated that BTC and ETH have maintained their dominance in both market cap and liquidity. 

Meanwhile, BNB, which leads XRP in market cap ranking, dropped to the eighth position in terms of liquidity as of the third quarter report. Kaiko noted that BNB is mostly liquid on the Binance exchange.

On the other hand, the report indicated that XRP boasted a higher liquidity score. In particular, XRP ranked directly behind Bitcoin and ETH regarding the liquidity metrics.

Further insights from the report highlight that Dogecoin (DOGE), Cardano (ADA), and Solana (SOL) exhibit performances closely aligned with their market capitalizations. Also, the report noted that Litecoin (LTC) outperformed expectations, securing the fifth spot in liquidity. 

Conversely, TON faced a substantial underperformance, ranking ninth by market cap but plummeting to 37th in liquidity. Other projects with substantial gaps between their market valuation and liquidity include Shiba Inu (SHIB), Uniswap (UNI), CryptoCom’s Cronos (CRO), and LEO token. 

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Besides, the Ethereum layer two Arbitrum (ARB) stood out by surpassing its market cap ranking by 25 spots. Specifically, it secured a position in the top 10 most liquidity coins.

Notably, the third quarter rankings were determined by considering various factors. It included spreads, 0.1% and 1% market depth, volume, and number of liquid exchanges supporting each token. The two distinct market depth levels cater to higher-frequency traders and longer-term holders. 

Also, the report highlighted that having more liquid exchanges for a token adds an extra layer of complexity. It makes activities such as oracle manipulation more challenging. BTC, ETH, and XRP led this metric significantly, establishing a notable margin over other tokens.