Markets
Ripple floods crypto market with millions of tokens, is XRP in peril?
2h30 ▪ 3 min reading ▪ by Fénelon L.
Ripple, the issuer of the XRP crypto, shakes up the market with a massive sale of 250 million tokens on June 20. This operation, valued at $122.5 million, raises questions about the future of the token and its price.
Ripple opens the floodgates, 250 million tokens flood the crypto market
On June 20, Ripple, the company issuing the XRP Ledger, orchestrated a massive sale of 250 million XRP from its monthly reserves. This large-scale transaction, valued at $122.5 million, shook the cryptocurrency market.
Earlier, on June 1, Ripple had unblocked 1 billion XRP from its initial distribution, which had been locked in staggered monthly deposits until 2027.
The company then allocated these funds strategically: 200 million XRP funded its Treasury account, while the remaining 800 million was re-blocked in new deposits.
Simultaneously, the “Ripple (35)” account injected an additional 200 million tokens into the sales reserves. This daring maneuver pushed the total stock of XRP ready for liquidation at 400 million, shattering company records in terms of monthly sales preparation.
The sales mechanism follows a well-oiled protocol: first, Ripple transfers the tokens from the Treasury account “Ripple (1)” to the anonymous account “rP4X2hTa”. Subsequently, these assets disperse across various exchange platforms, ready to enter the market and potentially influence its dynamics.
The consequences on the market
Ripple’s massive sell-off is undeniably having an impact on the XRP price. Indeed, the token has generally experienced local declines during most of the company’s sales. Since January, only 5 sales days out of 14 have seen a positive price change.
Similarly, XRP’s monthly performance in 2024 reflects this negative trend for three of the first five months. Currently, the token is trading at $0.488, down 5.5% since June 1, likely indicating another loss-making month.
In summary, this commercial strategy is part of a complex regulatory context. Indeed, Ripple has been facing SEC proceedings since 2020.
Thus, the company seems to want to comply with future crypto industry regulation. By reducing its hold on XRP, Ripple may be trying to prove that the token is not a financial security under its control.
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Fenelon L.
Passionate about Bitcoin, I like to explore the intricacies of blockchain and cryptos and I share my discoveries with the community. My dream is to live in a world where privacy and financial freedom are guaranteed for everyone, and I firmly believe that Bitcoin is the tool that can make this possible.
DISCLAIMER
The views, thoughts and opinions expressed in this article belong solely to the author and should not be considered investment advice. Do your own research before making any investment decisions.