Ripple unlocked 1 billion XRP tokens in January. Half has already been liquidated this week through split sales. The issuing company has in fact sold 100 million XRP, for a total value of $56 million. These sales come at a strategic time, just before a highly anticipated SEC decision on the Bitcoin spot ETF.
Ripple liquidates half of its newly unlocked XRP
Ripple unlocked 1 billion XRP tokens in January, as part of its monthly issuance program. The company held 200 million tokens in its treasury, with the rest released into circulation. Ripple then began split sales of its reserves.
On January 7, the firm transferred 100 million XRP, for $56 million, to intermediary accounts used to cover their tracks. One of them held 82.3 million tokens. The remaining 17.7 million was routed to another account. And this, before landing on exchanges like Bitstamp, Bitso or even BTC Markets.
In total, 45 million XRP have already been deposited on centralized exchanges within 48 hours. Ripple still has 100 million liquid XRP tokens in its reserves. These will be able to fuel new sales as opportunities arise.
Strategic sales as a crucial decision approaches
Ripple’s sales, representing a significant share of XRP’s daily volumes, have a certain impact on its price in the short term. The timing of this liquidation is therefore probably not a coincidence.
We are a week away from a highly anticipated SEC decision on potential spot-backed Bitcoin ETFs. If these index funds are approved, they could trigger a new speculative frenzy and high price volatility.
Ripple seems to have anticipated this coming turbulence, in already liquidating 100 million of XRP. The firm often makes strategic sales of its reserves during peaks of volatility, in order to maximize its profits.
In the space of a week, Ripple has already liquidated 100 million of the 200 million XRP allocated to its treasury in January, taking advantage of market nervousness ahead of a momentous decision by the SEC. Its split sales have a certain impact on the price of the token in the short term. We will need to closely monitor the next strategic disposals of Ripple, whose XRP reserves still remain comfortable.
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