Ripple has yet again caught the crypto community’s attention as the leading on-chain crypto tracker, Whale Alert, disclosed Ripple unlocking a massive 1 billion tokens from its escrow account.
Although the move action aims to improve market predictability and transparency through a long-term plan for managing the token supply, the investors were guarded based on the market’s quick response.
1 Billion Token Release In Phases
With its well-coordinated escrow mechanism, Ripple released one billion XRP tokens on September 1st. The transaction, executed in three phases within minutes, released 500 million, 200 million, and 300 million XRP tokens, respectively.
The first transaction released half a billion tokens valued at approximately $280 million. The second and third disbursements swiftly followed, ensuring that a substantial amount of XRP was injected into the market. These tokens, valued at over $560 million, were distributed from “Ripple 24” wallet, which has been active for over seven years.
XRP Drops 3%
In reaction to this crucial development, XRP’s price dropped temporarily with the token falling 3% on the same day. Notably, XRP had a strong day before the unlocking, rising as high as 10.5% at one point and finishing the day with a 3.74% price increase.
The company has yet to reveal its plan for the recently released 1 billion XRP. In its previous month’s 1 billion XRP release, Ripple had instantly removed 800 million (80%) of the total XRP tokens unlocked.
The crypto company has kept 55 billion XRP tokens in escrow since 2017 to regulate the supply of the cryptocurrency. Every month, Ripple releases 1 billion XRP tokens to provide more predictability in the market. However, the actual number of tokens entering circulation is often lower than this amount.
CTO’s Mixed Feelings
The original plan was to promote decentralization and reduce the grip on the supply by releasing 1 billion XRP monthly. However, the CTO David Schwartz is not sure about whether the ‘escrow thing’ was a good idea when questioned over its efficacy. The CEO has hinted that they might even burn some of those tokens to boost XRP’s ecosystem.
What do you think? Can this move finally push XRP’s price up? Stay tuned!
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