Ripple, the company behind the XRP cryptocurrency, has released 1 billion XRP (worth approximately 453.7 million USD) from escrow accounts in multiple transactions.
This is a routine process that happens every month to provide additional predictability to the XRP supply.
Why Is Ripple Releasing XRP From Escrow Accounts?
Ripple says it uses the escrow account system to provide transparency and certainty to the XRP market. The company locks up a large portion of its XRP holdings, ensuring that it cannot flood the market with excess supply and manipulate the price.
However, the company also uses the loaded XRP in escrow accounts to invest in and support projects in the Ripple ecosystem.
However, the monthly release of 1 billion XRP tokens from escrow does not mean that all of it will enter the market. Ripple may choose to sell some of it to institutional or retail investors, use some for its own purposes, or return some to new trusts.
In addition, we see that this massive release process does not have a negative effect on the XRP price. At the time of this writing, the XRP price has risen 2% in the last 24 hours.