XRP Sees Unusual 4,000,000 Token Escrow Lock Mid-month

The XRP community has witnessed an unusual escrow lock outside of the typical Ripple schedule, with investors questioning the origin and intent.

Notably, market tracking resource Whale Alert first called attention to the development in a recent post on X. According to Whale Alert’s disclosure, an unknown wallet locked 4 million XRP worth $11.213 million in escrow. The transaction occurred on Oct. 9 at 16:16 UTC. 

While the volume pales in comparison to the typical 300 million to 500 million XRP Ripple locks up at the start of each month, the timing of this event has triggered community interest, leading to speculations about the origin and purpose of the lockup.

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Flare Locks Up Millions of XRP in Escrow

Notably, a quick on-chain check confirmed that the escrow lockup came from layer-1 project Flare, with the transaction involving the Flare Core Vault (2) address. Interestingly, besides the latest 4 million XRP lockup, this address has locked up millions more since Sept. 24, the date of the first FXRP minting exercise.

For the uninitiated, Flare opened up minting for its FXRP project late last month, which promises to bring DeFi capabilities to XRP, including yield-generating staking features. They launched the minting phase on Sept. 24, and in just four hours, they hit the weekly cap of 5 million XRP, as reported by The Crypto Basic.

At this point, Flare’s escrow lockups began, as the address started with 16 batches of 250,000 XRP from 15:11 to 18:01 on Sept. 24. After this, the 250,000 XRP lockups resumed the next day and continued until Oct. 5. 

Flare followed up with two more lockups of greater volume, involving 4 million XRP each on Oct. 8 and then on Oct. 9, with the latest one being the transaction recently spotlighted by Whale Alert. 

FAssets Has Hit 20M XRP Milestone

Notably, data from XRPScan shows that so far, the Flare Core Vault (2) has locked up 15.5 million XRP worth $43.55 million at press time. This figure aligns with the subsequent minting exercise, as the Flare team introduced two more weekly caps of 5 million XRP each after market participants exhausted the first on Sept. 24. 

As reported by The Crypto Basic, by Oct. 9, the Flare team had bridged $43 million worth of XRP, representing the assets locked up in escrow. Interestingly, this figure has since increased to 20 million XRP worth $56.42 million at press time, with Flare having exhausted another 5 million XRP minting cap.

Now, network participants expect the project to lock up more XRP tokens to reflect the latest exercise. Notably, with Flare persistently locking up XRP in escrow, this would contribute to a drop in available XRP supply, lending credibility to the “supply shock” theory propagated by some community figures.