By
Godfrey Benjamin
April 24th, 2024
Ripple aims to provide greater market transparency and certainty about current and future XRP supply by placing 55 billion XRP into a transparently managed escrow account.
The price of Ripple Token (XRP) currently makes up $0.386 with market capitalization having reached $16,009,403,700. To feel the change, let’s compare these figures with the ones three months ago – on February 17th Ripple was traded at $0.006 and market capitalization was only $225 million. Thus, the price has increased seventyfold.
Bitcoin capitalization makes up $29,277,581,749, which is only 2 times more than Ripple’s cap.
Total capitalization of all cryptocurrencies accounts for $62,170,416,687 with Bitcoin comprising 47% and Ripple 26% of the total number. Two months ago, bitcoin’s share dropped below 80% before falling below 50% yesterday.
Ripple has announced that it will place 55 billion XRP into a transparently managed escrow account aiming to provide greater market transparency and certainty about current and future XRP supply. The company has recently launched Escrow and now will use the feature to cryptographically lock up 55 billion XRP, which will be released for its use 1B at a time on a monthly basis.
If some tokens remain unused, they will be placed back into the escrow queue at the end of the month. Ripple offers investors a predictable supply schedule, thus eliminating any questions or concerns about large-scale sale of XRP that could drive prices down.
“Our goal in distributing XRP is to incentivize actions that build trust, utility and liquidity. We engage in distribution strategies that we expect will result in a strengthening XRP exchange rate against other currencies. We have a proven track record of doing just that. Despite this four-year track record we have heard concerns in the market about uncertainty surrounding our ongoing XRP distribution”, Ripple says. “The root of this uncertainty is the notion that Ripple might one day sell its 61.68B XRP in the market at any time – a scenario that would be bad for Ripple! Our self-interest is aligned with building and maintaining a healthy XRP market.”
Ripple addresses this uncertainty by committing to place 55 billion XRP into a cryptographically-secured escrow account by the end of 2017.
Ripple says that its XRP is the best digital asset for payments as it has a clear use case. If compared to the most widespread cryptocurrency, Bitcoin, XRP is faster, more efficient and more scalable while Bitcoin has virtually reached its limit to process transactions.
“We partnered with Ripple because of their strength bringing financial institutions together. Ripple’s lockup of its 55 billion XRP with a cryptographic supply schedule is a clear signal that they are serious about building and maintaining a long-term, healthy ecosystem for XRP based applications,” says Mike Belshe, Co-founder & CEO of Bitgo.
XRP is convenient for financial institutions as it can provide on-demand liquidity in cross-border payments. With XRP, payment providers and banks will enjoy greater access to emerging markets and much lower settlement costs.