Ripple’s Recent Developments and Market Impact 🚀
With November upon us, Ripple is making significant waves in the cryptocurrency market, preparing potentially for its largest monthly sell-off in a span of seven years. The organization, which is the pivotal developer of the XRP Ledger and its principal holder, set aside 470 million XRP tokens, equating to approximately $240 million, for distribution.
Since 2017, each month, Ripple has systematically unlocked 1 billion XRP tokens and earmarked a portion of them—typically 200 million—for sale. In an unusual move this November, while unlocking the usual billion tokens, Ripple has opted to reserve more than double its typical amount for this month.
In line with its routine, the escrows terminated during this month were linked to both the Ripple (24) and Ripple (25) wallets, each releasing 500 million XRP as per custom. But notably, Ripple (25) has chosen to re-secure only 30 million XRP in one of its usual accounts, while transferring the rest—470 million XRP—to Ripple (1). Historically, this account has been utilized for monthly sales, raising concerns about the potential price implications for the token and the wider impact on XRP investors.
The History of Ripple’s Token Releases 📊
In reviewing Ripple’s past performance, the most significant dumping of tokens happened in June, when the company reserved 200 million XRP and augmented it with an additional 200 million from an inactive account (Ripple 35). The unprecedented sell-off reached its conclusion on June 20, with a total of 400 million XRP sold. This event triggered a drastic price decline of nearly 20% from the start of June until mid-July, underlining the financial repercussions of such bulk transactions.
As of now, XRP is trading at $0.511, reflecting a loss of 18.70% year-to-date. So far in 2024, Ripple has sold a total of 2.576 billion XRP, with the largest sales occurring in June (400 million), September (350 million), and July (300 million).
Looking Forward: Potential for Increased Selling Pressure 🔍
Historically, Ripple has maintained a consistent reserve routine, keeping the typical 200 million XRP reserved after monthly unlocks. However, this month is shaping up to apply unprecedented selling pressure on the market with the unexpected reservation of over 470 million XRP. Significantly, these transactions have coincided with the lead-up to the upcoming U.S. Presidential Election.
Chris Larsen, the co-founder and CEO of Ripple, recently announced a $10 million donation to Kamala Harris’s campaign, coming just after the recent sales. He remarked, “It’s time for the Democrats to have a new approach to tech innovation, including crypto. I believe Kamala Harris will ensure that American technology dominates the world, which is why I’m donating $10M in XRP in support of her.”
Ripple has traditionally been transparent about its sales strategies, employing an On-Demand Liquidity (ODL) model that dictates sales at market prices to interested parties, despite not publicly detailing the parameters of its recent spikes in sales.
Moreover, the outcomes of the upcoming presidential election may significantly influence the cryptocurrency landscape. XRP traders and investors should remain alert to any additional moves made by Ripple in light of the election results.
Hot Take: What This Means for Investors 🤔
As a crypto reader, understanding the implications of Ripple’s potential actions this November is essential. The significant reservation of XRP and its timing amid political movements could shape market sentiment and volatility. Pay close attention to how the market reacts over the coming days as Ripple nudges the boundaries of its operational norms, which could lead to unforeseen shifts in XRP’s price trajectory. Being informed will allow for better decisions in the fast-evolving realm of cryptocurrency.
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