Ripple’s Monthly XRP Unlock: An Overview
Understanding Ripple’s Monthly XRP Release
Each month, Ripple systematically releases 1 billion XRP tokens from its escrow system, utilizing the XRP Ledger’s capabilities. On January 1st, 2025, Ripple plans to unlock XRP tokens worth over $2 billion, divided into three batches: 200 million, 300 million, and 500 million XRP. This strategic move accounts for approximately 1.74% of the current circulating supply, which stands at 57.25 billion XRP. Additionally, this release represents 2.63% of the remaining 38 billion XRP tokens, which are still secured in Ripple-controlled escrows.
Details of the January 2025 XRP Release
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The final moments of December 31st will witness the conclusion of three escrow agreements managed by two specific Ripple-owned wallet addresses. Notably, the ‘Ripple (24)’ wallet will release 200 million and 300 million XRP, which were initially locked in December 2020 and January 2021, respectively. Simultaneously, the ‘Ripple (25)’ wallet will unlock 500 million tokens, initially secured in January 2021. Although these releases mark the end of ‘Ripple (24)’ and ‘Ripple (25)’ operations, numerous other escrows remain under Ripple’s management.
Ripple’s Past XRP Escrow Unlock and Management
Examining past events provides valuable insight into Ripple’s future actions following this significant unlock. On December 1st, the escrow system released 1 billion XRP. Ripple subsequently re-secured 800 million of these tokens in escrows set to conclude by February 2028. Meanwhile, the remaining 200 million XRP were allocated to ‘Ripple (1)’ for future distribution purposes.
Ripple’s Sales Strategy
In an aggressive sales maneuver, Ripple sold $500 million worth of XRP, reallocating these amounts to various known and unknown accounts. Additionally, the company sold more XRP from reserves held in ‘Ripple (50)’ and ‘Ripple (29)’, all without prior announcements. Interestingly, November saw Ripple execute its largest XRP sale in seven years, offloading 470 million XRP from the monthly escrow unlock. These tokens were transferred to ‘Ripple (1)’ and then redistributed to ‘Ripple (50)’ and other accounts.
Ripple’s Impact on the XRP Market
In 2024 alone, Ripple has sold 3.246 billion XRP from the ‘Ripple (1)’ reserve account, excluding movements from other accounts such as ‘Ripple (50)’ and ‘Ripple (29)’. With XRP trading above $2, these sales exert substantial selling pressure, exceeding $6.5 billion year-to-date. In contrast, the Ethereum Foundation’s annual Ethereum (ETH) sales budget is capped at $100 million, which remains unmet.
Ripple’s Strategic Approach and Market Implications
Ripple’s aggressive sales tactics present challenges for XRP’s market growth, necessitating a corresponding increase in demand to maintain market stability. According to Ripple’s Q3 2024 report, the company employs an On-Demand Liquidity (ODL) model, selling XRP at market prices to ready buyers. This approach mitigates the economic impact of potential large sell-offs, ensuring a more balanced market environment.
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