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According to Whale Alert, roughly 20 hours ago, it detected Ripple Labs moving one billion XRP coins that were shifted from escrow on Sunday, Jan. 1.
The majority of it was sent back to escrow an hour later.
Regular XRP withdrawals from escrow
As U.Today reported, three days ago, as 2023 started, Ripple conducted its traditional programmed withdrawal of a staggering billion XRP from one of its escrow accounts. These releases of XRP started five years ago, when the blockchain giant decided to support the liquidity of XRP tokens on the crypto market and began sending part of this monthly released billion to crypto exchanges, banks and payment operators that partnered with Ripple.
Part of this billion was also likely sold by the company to cover its operational expenses.
As a rule, Ripple moves roughly two thirds of the released billion coins back to escrow to lock them there until the next withdrawal.
Ripple locks back 700 million XRP
This is exactly what happened 20 hours ago — Ripple moved one billion XRP in chunks of 500, 200 and 300 million XRP and then sent 400 and 300 million coins to escrow. The unlocked billion XRP was worth approximately $352 million at the current exchange rate.
The 700 million that was locked back is the equivalent of $246.1 million in fiat.
When Ripple started these regular monthly withdrawals, it had locked 55 billion out of the 100 billion of the premined XRP supply in escrow, planning to release them within several upcoming years. By now, the amount of locked XRP is 42.7%. There is plenty of XRP left in escrow thanks to Ripple locking back the majority of tokens it releases on the first day of a new month.
Possible reason for locking XRP back
Since the end of 2020, the demand for XRP on exchanges seems to have diminished substantially. Several top exchanges, including the biggest one located in the U.S. (whose shares have been publicly traded on NASDAQ as of late) — Coinbase — and Bitstamp, suspended XRP trading, and some delisted XRP altogether.
This is likely one of the reasons why Ripple is not injecting an entire set of monthly-released billion tokens onto the market but only one third of it, sending the rest to be locked back.
Alex Dovbnya
Arman Shirinyan
