Ripple releases half a billion XRP into circulation

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Updated on Mar 11, 2020

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Ripple released another 500 million XRP from escrow, once again confusing the community with this practice.
The company did not offer an explanation for why it releases high amounts of money every month, except for saying that it is due to the protocol.
Many have expressed a negative stance towards the move, and are now expecting a major sell-off.

A cryptocurrency startup Ripple — the company that created the third-largest cryptocurrency, XRP — has just released 500 million units of XRP from its escrow account. According to current prices, that translates to around $115 million worth of XRP.

At the moment, traders are making preparations for the consequences, which may lead to another 500 million XRP-large withdrawal. As many may know, releasing new coins into circulation is not uncommon, and it is usually done at the start of the month. Even so, whenever it happens, the move is almost always heavily criticized.

More than that, the community is still confused by Ripple’s decision to release over $100 million every month. Many also suspect that this is far from being the full amount, as the company usually unlocks twice as many coins per month. The confusion has once again led many to compare Ripple with fraudulent projects such as PlusToken, at least when it comes to injecting liquidity into the existing market.

In other words, the decision was once again met with the usual negativity, especially among the analysts, who expect that the new token injection might trigger a new big sale.

XRP price dropping after mid-February

As for Ripple, the company once again failed to explain why it does this every month, and why does it release such high amounts. The only piece of explanation that Ripple did offer is that it is due to the protocol and its design, and that the process had existed for quite a long time. But, when it comes to how these funds are spent — Ripple did not go into too much detail.

At the time of writing, XRP sits at $0.233587, with 0.61% growth against the USD in the last 24 hours, and 0.55% drop against Bitcoin during the same period. Since the start of the year, the coin managed to slowly surge up to $0.337757 in mid-February, from where it started dropping until it nearly reached its price from the beginning of the year.

The company has also seen legal problems recently due to the judge’s decision to allow a case against Ripple to proceed, with accusations of tricking investors into buying unregistered securities.