XRP continues to gain popularity in the cryptocurrency market. With a market cap of over $28 billion, the digital token currently ranks as the seventh most popular cryptocurrency. But, the token’s market price can quickly rise or drop based on several factors, among them the top XRP holders by percentage.
Often called “whales,” top cryptocurrency holders can affect the market value of a coin when they sell a significant portion of their holdings or buy even more tokens. As a result, you want to keep a close eye on who controls the market to anticipate any potential price changes.
Overview of XRP
The XRP digital token is the native cryptocurrency for the Ripple Network that runs on the XRP Ledger (XRPL) open-source blockchain. You can buy and sell XRP on cryptocurrency exchanges. But beyond trading, XRP provides faster and cheaper cross-border transactions. As a result, financial institutions like banks and remittance service providers have been the most popular users of the XRP token. However, consumers and retailers have also been steadily active participants in XRP trading.
The history of XRP began in 2012 when Jed McCaleb, David Schwartz, and Arthur Britto built the underlying payment-focused protocol, XRPL. They pre-mined a finite total supply of 100 billion XRP tokens. Thereafter, they retained 20 billion XRP tokens among themselves while they gifted 80 billion XRP tokens to Ripple Labs in exchange for taking over the development, issuing, and partial management of XRP.
As XRP became the primary digital currency for trading on the Ripple Network, it climbed the charts to become among the best cryptocurrencies out there. Its peer-to-peer network of servers underlying the decentralized XRPL it operates on made way for the Consensus Protocol method of validating transactions. Financial institutions and consumers alike could use XRP to trade across borders, near-instantly and with minimal fees.
With time, XRP collaborated with major financial institutions like American Express that further validated the token’s use cases in financial markets. Amid the meteoric rise in XRP market influence, the cryptocurrency hit a stumbling block as a controversial court case against Ripple ensued in 2020. Some cryptocurrency exchanges delisted XRP. Soon, however, the company scooped up a partial win that restored XRP’s market influence.
Today, the current XRP distribution places 60 billion XRP tokens in circulation. Over the years, the XRP founders have retained most of their share of XRP assets, while some of them have liquidated their holdings. For those who held on to their share of XRP, they remain among the top XRP holders. Meanwhile, Ripple Labs has locked away 39 billion XRP tokens in escrow, releasing new tokens every month. As a result, the company ranks among the major XRP holders.
Why XRP Distribution Matters
XRP distribution tracks the allocation and disbursement of XRP tokens to businesses, investors, and consumers. At the moment, there are 60 billion XRP tokens in circulation and 5 million active XRP holders. Out of these active holders, the top ten XRP holders control 40% of the total circulating supply.
Meanwhile, the top 20 control 51%, the top 50 control 64%, and the top 100 control 72% of the total circulating supply. The XRP concentration is pretty high at the top, centralizing the most amount of tokens in just a handful of wallet addresses. Moreover, the top 10 wallet addresses hold approximately 11 billion XRP tokens worth $5.5 billion as of the time of writing.
Based on the steep concentration in a select few, you can pinpoint a couple of “whales,” which is a moniker given to cryptocurrency holders who own a significant amount of tokens. So much so that if they were to sell a massive chunk of their holdings or buy even more tokens, they could potentially cause the market price to fluctuate drastically.
More precisely, when whales sell a significant portion of their tokens, the supply of XRP tokens will increase, likely causing bearish sentiment and the value of the token to drop. However, if they buy more tokens, the demand for more tokens may increase, potentially causing the market price to go up.
Even more so, investors and consumers tend to keep a close eye on whales. If whales sell or buy assets, investors and consumers tend to do the same, anticipating a potential fluctuation in market prices.
As such, it’s paramount to keep a close eye on XRP distribution to stay on top of price volatility. More so, XRP distribution informs you of market dynamics and XRP concentration. You’ll want to know the wallet addresses that currently hold the most assets to keep track of when they make big moves that could destabilize the market price.
Beyond individual wallets, Ripple Labs has locked away 39 billion XRP tokens in escrow. And, while they have planned for a steady release of 1 billion XRP tokens per month, the magnitude of the number of tokens the company controls still raises concerns. If dumped on the market, it can cause unprecedented price swings. Overall, you want to keep a close eye on the individuals, entities, and companies that control a significant share of the total circulating supply. If they were to make drastic moves, they could easily destabilize XRP price stability.
Top XRP Holders by Percentage
In total, XRP has 5 million active accounts. However, only a handful of these accounts control the biggest share of the total circulating supply. As a result, you’ll want to keep a close eye on major XRP holders. The top XRP holders by percentage have a lot of power over the value of XRP. They can be individuals, entities, or businesses, provided they own the most XRP. We’ve looked through the wallet addresses with the most XRP tokens and listed down the top XPR holders by percentage below.
Ripple Labs XRP Holdings
As expected, Ripple Labs is the highest XRP holder by percentage. The company partially manages the XRPL blockchain by releasing new XRP tokens into circulation and selling the XRP assets they own to fund operations and other payment-focused distributed financial projects. Ripple Labs XRP holdings are of two types: circulating and non-circulating XRP tokens.
Ripple Labs’ circulating XRP tokens are held in multiple wallet addresses, the highest of which are the wallets Ripple (29) and Ripple (39). While Ripple (29) controls 1.96% of the total circulating supply, Ripple (39) controls 1.42% of the total circulating supply. Both wallets hold approximately 1 billion XRP tokens worth $500 million at the time of writing.
As for the non-circulating tokens, Ripple Labs has locked away XRP tokens in escrow, which they release periodically every month. In 2017, the company locked away 55 billion XRP tokens in escrow, held in multiple wallet addresses. Over the years, they have released 1 billion XRP tokens every month, leaving the company with 39 billion XRP tokens worth $19 billion.
The combined value of the tokens in circulation and in escrow has skyrocketed Ripple Labs to the top XRP holder in the XRP rich list. While the company holds a significant portion of XPR tokens, the magnitude of XPR assets it owns helps it retain partial control over the underlying XPRL blockchain.
XPRL may be open-source, but Ripple Labs is a major contributing stakeholder. They often sell their share of XRP to help fund the development of XPRL while also regulating liquidity and price stability.
UPbit
Next up is UPbit, a South Korean cryptocurrency exchange that is run by Dunamu Inc. The UpBit (22) wallet controls 1.61% of the total circulating supply. Moreover, the wallet address holds a whopping 1 billion XRP tokens worth $500 million.
It’s unsurprising that UPbit controls a significant share of XRP tokens. Being a cryptocurrency exchange, the tokens are likely reserves of the deposits made by UPbit’s customers.
Binance
Binance takes third place among the top XPR holders by percentage. The cryptocurrency exchange is the largest exchange by trading volume. So, it makes sense it would have a significant share of XRP tokens likely reserved for its customers. The Binance (4) wallet controls 1.47% of the total circulating supply, with 1 billion XRP tokens worth $500 million.
Uphold
Uphold has two wallet addresses in the running for fourth place among the top XRP holders by percentage. The multi-asset trading platform holds various assets for its customers, including the XRP digital currency. At present, Uphold (8) and Uphold (4) control 1% of the total circulating supply, with 1 billion XRP tokens worth $500 million each.
Unknown
There are two wallet addresses whose identity is unknown. It’s possible they belong to an individual investor whose name isn’t accessible to the public. Still, there are two such addresses, each controlling 0.6% of the total circulating supply. While the first wallet holds 665 million XRP tokens, the second holds 659 million XRP tokens.
BitBank
BitBank ranks seventh in the top XRP holders by percentage. The company is a prominent cryptocurrency exchange in Japan that provides players with the freedom to buy and sell cryptocurrencies, including XRP. The wallet, BitBank (2), controls 0.63% of the total circulating supply, with 639 million XRP tokens worth $320 million.
Kraken
Kraken, a US-based cryptocurrency exchange, is a close eighth top XRP holder by percentage. Its Kraken (2) wallet controls 0.61% of the total circulating supply, with 614 million XRP tokens worth $307 million.
Bithumb
Another South Korean cryptocurrency exchange with a high share of XPR tokens is Bithumb. Users buy, sell, and make deposits on the platform, including in the form of XPR tokens. At present, the exchange has Bithumb (10) and Bithumb (9), controlling 0.6% and 0.5% of the total circulating supply.
Chris Larsen
While the top XPR holders are either Ripple or cryptocurrency exchanges, Chris Larsen, co-founder and former CEO of Ripple, also makes it to the top 10 XPR holders by percentage. Given the initial 20 billion XPR tokens allocated to the founders of XPRL, it’s unsurprising that he owns a significant share of the cryptocurrency.
Chris Larsen may have stepped down as CEO in 2016. However, he’s still the executive chairman of Ripple Labs. Since co-founding Ripple, he’s held on to his share of XRP assets, with Forbes reporting he owned 5.19 billion XRP tokens, in addition to a 17% stake in the company.
At present, Chris Larsen has five wallets in the top 40 XPR holders list, each holding approximately 500 million XPR tokens. Combined, he controls 2.5% of the total circulating supply of XPR. Meanwhile, the current CEO, Brad Garlinghouse, follows closely behind, with a 6.3% stake in Ripple Labs.
Potential Risks and Benefits
With Ripple, cryptocurrency exchanges, and some XPRL co-founders owning a significant share of the total circulating supply of XPR, it raises the risk of market price fluctuation. But a high XPR concentration on a select few holders can affect the market for the better too.
Risks
Major XPR holders may have sway with Ripple Labs, nudging or blackmailing them to act in their interest.
When a top XPR holder makes a single transaction worth a big chunk of their assets, they can cause drastic price swings.
Whales are often aware of the power they have to manipulate XPR price volatility. As a result, they may make moves to destabilize the market in their favor. As opposed to decentralization, whales end up having too much control over the market and the Ripple ecosystem at large.
Benefits
Tracking top XPR holders can help predict potentially profitable trades.
Some major XPR holders may provide liquidity in exchange for some form of compensation from trading fees or other means.
By holding significant amounts of XPR tokens, top XPR holders help make the token scarce and thus more valuable.
Impact on the Market
Having a handful of XRP holders with a substantial amount of tokens gives them the power to control XPR market liquidity and price. If the top XPR holders by percentage sell most of their assets, the supply of XPR will increase, causing the liquidity to go up and market value to drop. Alternatively, if the top XPR holders actively buy more XPR assets, demand for the token will increase, causing the liquidity to drop and the market value to spike up.
Price Manipulation
Investors and consumers have recognized this pattern among cryptocurrency whales. As a result, they keep a close eye on any trades top cryptocurrency holders make. Using whale tracking apps, retailers quickly learn when whales are making a move in the market.
If a whale sells a massive chunk of their assets, investors quickly sell their assets, too, anticipating a price drop and thus, cutting their losses early. Similarly, if whales buy a huge chunk of a token, investors buy the token too, anticipating the price will go up and thus making money in the process.
Unfortunately, it’s not always that whales act on sound information. Sometimes, they may be privy to vital information yet to be revealed to the public. However, other times, they act on a whim, and investors pay for it. On some occasions, whales make moves knowing the public is watching. They may manipulate consumers into buying or selling their assets and profit from misguiding them.
Market Liquidity
Another impact top XPR holders can have on the market is liquidity. If whales continue to hold their assets, they can lower liquidity, reducing the amount of tokens that consumers are able to actively buy and sell. This mostly affects smaller cryptocurrencies with a limited circulating supply.
However, if major XPR holders sell a massive chunk of their assets, it can increase liquidity, allowing for quick entry and exit trades. But while higher liquidity can make transactions easier, it can also flood the market with too many coins that are absorbed too slowly. As such, it creates a problem of high supply over demand that can lower market prices.
Liquidity and volatility are often interconnected. More precisely, major XPR holders can manipulate liquidity and market prices. So, be sure to keep a close eye on top XPR holders who can easily take advantage of their power to manipulate the market to their favor.
Regulatory Concerns
One of the biggest regulatory concerns about XRP concentration is that Ripple Labs owns the most shares of XPR tokens. The company has 39 billion XPR tokens locked away in escrow that, if dumped on the market, could drastically destabilize the currency. However, Ripple has consistently kept up to speed with the plan to release 1 billion XPR tokens per month. Starting at 55 billion XPR, they have maintained reliable liquidity of the tokens available for trading. Moreover, the company has been selling XPR tokens to further enhance the currency’s market and use cases.
Ripple has, in the past, been entangled in a court case. The SEC filed a suit against the company, citing the sale of the XRP cryptocurrency as an unregistered security offering. It was a highly spectacle case, impacting the cryptocurrency world at large. And while Ripple has won the case partially, the company isn’t out of the woods yet. More so, thanks to the impact the case has had on XPR’s market value. Several cryptocurrency exchanges have delisted XRP, but it seems that the payment-focused token is rising from the ashes. As more investors and institutions incorporate XRP in their services, including international entities keen to adopt the faster and cheaper payment protocol, XRP market influence continues to thrive.
Conclusion
Besides Ripple Labs, the top XPR holders by percentage are cryptocurrency exchanges and co-founders of Ripple. XPR concentration is, unfortunately, primarily focused on a handful of individuals, entities, and businesses. However, at least Ripple Labs, the company with the highest share of XPR tokens, has locked away most of its stake in escrow, only releasing 1 billion XPR tokens every month. It allows for relatively stable market prices and reliable liquidity. Still, you’ll want to keep a close eye on the major XPR holders, keeping track of when they sell or buy massive chunks of XPR assets that can potentially affect XPR price volatility.
The post Understanding the Top XRP Holders by Percentage: Who Controls the Market? appeared first on Coinfomania.
