Posted 2 years ago | by Ben Armstrong

200 Million XRP to Hit the Markets (Maybe)

Whale Alert recently spotted a transaction between an XRP address, which is the Ripple Escrow wallet, and an address owned by Ripple Labs. There was a large token lockup of 200,000,000 XRP transfered from the wallet to Ripple Labs.

Following that, the token monitoring service saw 1,000,000,000 XRP also unlocked from escrow at Ripple Escrow wallet, which implies that even more of the token may be sold or distributed, which could equates to increased selling pressure in the market.

XRP's price has been under pressure over the last few months, and has broke below the $0.20 USD level in recent weeks. At the time of writing, XRP has broken back above $0.215 USD, which may be a bullish signal over the medium term.

XRP’s Wacky Tokenomics

Whatever Ripple did, analysts say that Ripple has this ability to present a potentially long-term bearish case for XRP. Bully is a popular cryptocurrency commentator, and they left a tweet knocking Ripple’s dumping of XRP on retail investors.

Founder of Quantum Economics and the former senior analyst at crypto and asset exchange eToro, Mati Greenspan, remarked on twitter that XRP’s tokenomics have two primary flaws:

According to Greenspan:

  1. Ripple holds a large portion of tokens and sells them into rallies.
  2. Usage of the network does not necessarily require XRP tokens. Banks can use Ripplenet without using the token

Falling XRP Sales

According to Ripple’s Q3 2019 XRP Markets report, the three months of that fiscal quarter XRP sales still amounted to $66.24 million, though there was a decrease in the sale of their flagship cryptocurrency. In Q2, this figure was closer to $250 million.

Analysts in the cryptocurrency space, including people like Multicoin Capital’s Kyle Samani, have suggested that Ripple can release millions of XRP onto the public market to drive down prices. Back to August 2019, Ripple chief executive, Brad Garlinghouse claimed that the mass sale of the XRP tokens is not an attempt to dump on retail investors.

Garlinghouse stated:

XRP sales are about helping expand the asset’s utility – building RippleNet & supporting other biz building w/XRP ie Dharma & Forte. Reality is we DECREASED our sales by volume Q/Q and since then the inflation rate of XRP circulating supply has been lower than that of BTC and ETH.

For the moment, it would appear that there are larger forces driving the price of XRP. Whether or not these odd tokenomics will keep XRP prices down in the long-term is anyone's guess.

About Ben Armstrong

ef4f73e9ddeb61becab57469962fa946?s=90&d=blank&r=g 200 Million XRP to Hit the Markets (Maybe)Ben Armstrong is a YouTuber, podcaster, crypto enthusiast, & creator of BitBoyCrypto.com. Better known as BitBoy Crypto, he works hard to educate and inform the crypto community.

Ben has been involved with the world of cryptocurrency since 2012 when he first invested in Bitcoin. He used Charlie Shrem's BitInstant & lost Bitcoin in the Mt. Gox hack.

In 2018, Ben decided to go "full-time crypto" and focus all of his time and energy into expanding the reach of crypto.

If you have any questions or comments please feel free to email him at BitBoy@BitBoyCrypto.com or contact him on Twitter @BitBoy_Crypto.