XRP Escrow Unlocked: Will Whales Expand Their XRP Holdings

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A recent event has sparked curiosity among investors – the unlocking of 1 billion XRP tokens, estimated to be around $454 million by Ripple. This massive release was carried out in several transactions, causing a stir in the community and a crucial question: What happens now?

Breaking Down the Process

Ripple has established a consistent routine of infusing more XRP tokens into the circulating supply, a strategy designed to keep the cryptocurrency’s price stable. This scheduled release of tokens potentially ramps up the selling pressure among the token holders.

The recently unlocked 1 billion XRP coins came in five separate transactions. The opening act involved the release of 100 million XRP, which was quickly followed by the second and third transactions, releasing 400 million and 200 million tokens, respectively. The release schedule wrapped up with the fourth and fifth transactions, each introducing another 100 million and 200 million XRP tokens.

The Monthly Ripple Effect

The monthly token unlocking is not a new strategy by Ripple. Since 2017, Ripple has been methodically releasing large batches of XRP from its escrow account, with the transactions typically occurring on the first day of every new month. 

However, what follows the release is equally important. In an effort to uphold the stability of XRP’s price and satisfy its On-Demand Liquidity (ODL) needs, Ripple usually returns a significant portion of these funds back into escrow within a couple of days.

Speculations Amidst Market Fluctuations

At the time of writing this article, XRP’s value is hovering around $0.483, marking a slight increase of 0.33% over the last 24 hours. This small uptick follows a week of negative performance, leading to speculation and unease among investors about the potential impact of the escrow release.

While fears of increased selling pressure are present, it’s crucial to note that the effects of such a release on XRP’s price may not be immediately apparent. These anxieties might not always translate into immediate market shifts. Despite a slight recovery today, investors and traders are still playing a waiting game to discern the actual impact of the escrow release on XRP’s price.