- Ripple transferred 100 million XRP tokens during a cryptocurrency market crisis.
- A substantial amount of XRP was deposited into centralized exchanges, possibly for sale.
Ripple has recently garnered attention as it transferred 100 million XRP tokens from a pool of 200 million that had become accessible following the release of 1 billion XRP tokens in September. This event occurred amid extreme price volatility and market turbulence on September 11, which resulted in substantial losses throughout the cryptocurrency market. Ripple’s movement of 100 million XRP tokens stood out for several reasons.
This 100 million XRP was part of the 200 million XRP that became available due to a token unlock in September. While token unlocks are routine, the timing of this transfer was noteworthy because of the prevailing market conditions.
Ripple’s Unusual XRP Transfer Amid Market Turmoil
Ripple’s decision to move and potentially sell 100 million XRP tokens during the market turmoil raises significant questions regarding its strategy and financial stability. While it’s common for cryptocurrency projects to diversify their holdings or fund their development through token sales, the timing and scale of this transfer deserve attention.
This action by Ripple may have been motivated by the need to secure funding for ongoing initiatives, address regulatory challenges, or manage financial stability. However, it also exposes the project to the risk of exerting downward pressure on XRP’s price, especially during market stress.
Following the release of 1 billion XRP tokens from escrow. Ripple initially re-locked 800 million of these tokens into new escrow accounts while retaining 200 million in the Ripple (1) account for future circulation through XRP’s supply inflation mechanism.
However, a notable series of transactions occurred on September 11th. Initially, 100 million XRP were moved from the Ripple (1) account to an unknown address labeled “rJqiM…La8nE.” Within two hours, these 100 million XRP were transferred to another undisclosed address, “rhWt2…E32hk.”
The entity controlling these accounts retained 28 million XRP in “rhWt2…E32hk” while sending the remaining 72 million XRP to an address named “rwKcm…r9Dcv.” Interestingly, this entire amount was rapidly transferred back to the “rhWt2…E32hk” address, only to be promptly redirected to a new account denoted as “rJgpQ…7hCvf” in less than one minute.
Once again, within less than one minute, an entity dispatched 72 million XRP to another undisclosed address, labeled as “r4wf7…h4Rzn.” This address temporarily served as an interim destination before forwarding the tokens to four well-known centralized exchange addresses.
XRP Tokens Flow to Centralized Exchanges
Bitstamp received 39.875 million XRP, Bitso obtained 22.78 million XRP, Independent Reserves received 8.65 million XRP, and BTC Markets received 500,000 XRP. This operation deposited a substantial amount of 71.805 million XRP tokens into centralized exchanges (CEXes). These transactions typically suggest an intention to sell these tokens in the market.
These actions have generated interest within the cryptocurrency community, leading to speculation and discussions about the motivations behind these transfers and their potential impact on XRP’s market dynamics.
XRP’s Market Capitalization Decline
As the broader cryptocurrency market experiences a continuous decline, XRP is no exception. It has witnessed a reduction of over $1 billion in market capitalization within just a few days, despite efforts to boost liquidity by releasing 1 billion XRP from Ripple’s escrow system and re-locking 80% into two escrows.
Specifically, seven days ago, on September 4, XRP’s market capitalization stood at $26.58 billion. However, as of now, it has fallen to $25.63 billion, indicating a loss of $95 million. As of press time, XRP is trading at $0.4828 and a 24-hour increase of 0.87%.