As more companies join the Ripple net, Ripple is forced to unlock more XRP from escrow to provide market liquidity. However, this in turn ends up dumping the price of XRP due to the circulating supply increasing, causing many XRP hodlers to get rather mad. A satirical petition demanding that Ripple stops this practice picked up momentum back in August, with many actually buying into the idea
It appears as if the satirical petition has fallen on deaf ears, as Ripple just unlocked 1 billion XRP from escrow. Although, Ripple has said that it promises to sell less in September, but can the company really be believed?
Business as Usual for Ripple
With new companies like MoneyGram joining the xRapid platform, it only makes sense that institutions need to get their hands on more XRP to increase liquidity. At the start of every month, Ripple unlocks a healthy chunk of XRP from escrow, selling it off to institutions and exchanges, then returning what’s left back to escrow. It does this process every month, but after saying that it will sell less in September, unlocking 1 billion XRP from escrow has raised a few eyebrows.
? ? ? ? ? ? ? ? ? ? 1,000,000,000 #XRP (258,488,781 USD) unlocked from escrow at Ripple Escrow wallet
— Whale Alert (@whale_alert) September 1, 2019
In a statement, Ripple said:
Sales had been tied to trading volumes reported by exchanges, and recognizing that some platforms were misreporting volumes, Ripple has ‘substantially reduced XRP sales,’ a trend that’s expected to continue this quarter.
Well Known Fears
While this issue only seems to be picking up steam following Crypto Bitlord’s satirical petition, it has been a problem facing the XRP community for years. Jed McCaleb – co-founder of Ripple – is no longer at Ripple, but he continues to sell 500,000 every day, adding further huge sell walls to exchanges around the globe with XRP pairs. Until Ripple stops this practice – and McCaleb does too to some extent – then XRP will never make a break towards its previous all-time high.
Crypto Twitter Hits Back
As Whale Alert broke the news on Sunday, crypto Twitter quickly jumped into action, making jokes and posting memes at Ripple’s expense. Numerous people called Ripple a scam as it manipulates the price so much, while others said they’re holding tight, expecting XRP to bounce back and be worth $1,000 in the near future…
— crypto mAki (@cryptomaki1987) September 1, 2019
Until Ripple stops unlocking more XRP from escrow, then this pattern of small gains followed by huge dumps is going to continue. Smart traders would have picked up on our signal back in April and started to exploit this patter, making healthy gains in the process. For die-hard XRP hodlers, it’s going to be a slow and painful ride back up to all-time high prices.
