More XRP was released from Ripple’s escrow account, causing its price to slump.
Today, famous blockchain company Ripple Labs has released a whopping 1 billion XRP from its escrow wallet. The 1 billion XRP was unlocked from escrow in two separate transactions, representing 500 million XRP for each transaction.
? ? ? ? ? ? ? ? ? ? 500,000,000 #XRP (405,696,050 USD) unlocked from escrow at Ripple Escrow wallethttps://t.co/R1rFOCz2Xa
— Whale Alert (@whale_alert) April 1, 2022
? ? ? ? ? ? ? ? ? ? 500,000,000 #XRP (405,696,050 USD) unlocked from escrow at Ripple Escrow wallethttps://t.co/x7DwCYcVyN
— Whale Alert (@whale_alert) April 1, 2022
WhaleStats, a blockchain company that tracks the movements of large crypto funds, disclosed the development on Twitter moments after the transactions were completed.
According to the blockchain details of each transaction as reported by WhaleStats, the XRP funds, unlocked in the early hours of today, were worth around $811.39 million.
The recently unlocked XRP harmed the price of the cryptocurrency. Per data on Coingecko, the token is down 4.4% from its yesterday price, as it is now changing hands at $0.82 at the time of writing.
While the dip in XRP price cannot be entirely blamed on the recently unlocked Ripple coins, by the law of demand and supply, more volume of XRP in circulation could result in a decline in its value.
Contrary to the method of token allocation of most cryptocurrency projects, the vast majority of XRP is controlled by Ripple Labs.
To convince investors that it would not dump the coins on them, thus causing its price to crash significantly, the Ripple team agreed that it would hold 55% of the 100 billion XRP total supply in escrow.
At the end of the 2017 bull market, Ripple announced that it would be releasing the XRP held in the escrow accounts for 55 months.
To further manage the price of XRP from any negative impact, the company usually returns a significant amount of the funds to the escrow wallet.
It is not clear whether the team will return most newly released funds to the wallet at press time.
The Ripple team is trying to do everything within its power to keep the XRP price afloat, especially now that the blockchain company is still undergoing a legal battle with the Securities and Exchange Commission (SEC).
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