Ripple unlocked 1 billion XRP today, valued at $1.92B, continuing to release 55B tokens over time.
XRP gained 283.9% in November, but the release of 1B tokens could trigger short-term price volatility.
A massive 5B XRP transfer worth $970M was tracked, raising questions about market impact.
Ripple Labs released one billion XRP tokens from its escrow accounts, a normal procedure in the company’s monthly schedule. As of the time of writing, the market value of the unlocked tokens is estimated to be $1.92 billion.
This release is consistent with Ripple's pre-set schedule, which is to unlock one billion XRP tokens daily on the first day of each month. The idea is to issue up to 55 billion tokens, about 55% of the entire XRP supply. This strategy is meant to help bring a known quantity of XRP into the market.
https://twitter.com/whale_alert/status/1863012219723653626
Ripple has around 37.24 billion XRP tokens in its escrow accounts. However, the number of tokens in the market has not been definitively set. The final number will be based on how many unlocked tokens are claimed and then staked back into the escrow. Nevertheless, such a significant number of tokens hitting the market might affect XRP’s price, especially given the recent growth.
Potential Market Volatility After Token Release
Recently, XRP has been one of the most popular cryptocurrencies in the market, notably by its performance in November. The token ended the month with a remarkable price increase of 283.9%. Nevertheless, the issue of the most recent token release comes when the price of XRP is at its highest in seven years, a move that presents risks of market volatility. The release of a billion tokens could cause price changes. This is especially for those who do not have much understanding of the token dynamics of XRP.
In the wake of this large-scale token unlock, the cryptocurrency market has experienced minor price corrections. On December 1st, XRP fell by a mere 2.4% during intraday trading. Notably, most analysts' opinions don't consider it a major reversal given the overall bullish tendency observed throughout November. With the recent launch of new XRP tokens, the cryptocurrency was still trading higher than its initial price of $1.93.
Large Transaction Sparks Investor Interest
Besides the token release, there has been another prominent event relative to XRP in the market. Whale Alert, a popular crypto transaction tracking platform, reported a major transaction. At around 8:08:11 AM UTC+8, 5 billion XRP tokens held in private wallet addresses were released from ‘Cryptographic Proof’. This large transfer, with a market value of $970 million, was effected in two different transactions.
More uncertainty in this case comes from the fact that the identity of the wallets that executed this move is still uncertain. Such a transaction size is not exceptional in cryptocurrency, but it generally leads to doubt about how it can influence the market. Such transfers depend on timing and scale and affect the trader or investor seeking to ascribe short–term market trends.
The post Ripple Releases One Billion XRP Tokens, Sparks Investor Concerns and Market Movement appeared first on Crypto News Land.
