Prominent crypto payment company Ripple has released a huge amount of XRP from its escrow wallet into circulation. According to a report by blockchain tracker Whale Alert, Ripple transferred a total of 1 billion XRP tokens valued at $513.37 million out of its escrow account in the early hours of the day.
Whale Alert states that this transfer occurred over three transactions, with Ripple releasing 500 million XRP worth $271. 05 million from an unknown wallet in the first transaction. Thereafter, 200 million XRP and 300 million XRP were released respectively from the wallet bringing the total transfer to 1 billion XRP tokens.
The Ripple 55-Month Escrow Project
Interestingly, this release of 1 billion XRP by Ripple is not a new or unusual event in the crypto space, as it occurs virtually every month. In 2017, Ripple released a statement laying out its intention to lock up 55 billion XRP tokens using the Escrow feature on the XRP Ledger.
Ripple Labs explained that 1 billion XRP would be released monthly to incentivize investors and keep the interest around the token. At the start of 2018, Ripple began implementing its plan and has been consistently barring a two-month pause in October-November 2022.
That said, it is worth stating that not all 1 billion XRP is left in circulation after release. A huge chunk of the newly released tokens, between 600-700 million XRP, are usually returned back to the Escrow wallet a few days after the release.
Therefore, it is expected that a large portion of the latest XRP release will be captured from circulation in the next few days, perhaps before the end of next week.
XRP Down By 5%
Reacting to this 1 billion token dump on the market, XRP appears to be slightly affected. Data from Coingecko shows that the altcoin has lost 5.1 % of its value in the last 24 hours.
XRP trading at $0.50556 | Source: XRPUSD chart on Tradingview.com
However, looking at its broader performance, XRP has been one of the most impressive tokens in recent weeks. The altcoin has gained 19.2% in the last week and 32.4% in the last month.
That said, XRP remains a hot topic in the crypto space due to the ongoing court case between Ripple and the United States Securities and Exchange Commission (SEC). In 2020, the SEC filed a lawsuit against Ripples for issuing XRP, alleging the token was an unregistered security.
Over the last two years, there has been a hot legal battle between both entities with many twists and turns. Although SEC has never lost a crypto lawsuit case, there is growing positive sentiment among investors that Ripple will emerge victorious when judgment is eventually passed – possibly this month.
At the time of writing, XRP is trading at $0.50, having gone down by 1.2% in the last hour. With a market cap value of $26.27 billion, XRP remains the sixth-biggest cryptocurrency in the market.
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