Most people will recall how Ripple announced a massive XRP lockup. Around 44 billion tokens would be put into a time-locked contract. Earlier this year, it was unclear when that would happen exactly. We now know this escrow lockup has been completed last night. With fewer tokens in circulation, things are looking pretty good for the company. Whether or not it will have a big impact on the asset’s price, remains to be determined, though.
The XRP Escrow lockup is a pretty big deal for Ripple. The company unveiled their plans to do so earlier this year. However, or with no specific timeline in places, there was still some confusion over this development. All of that has been put to rest, as the lockup has effectively been finalized. This also means there will be no current additions to the circulating XRP supply whatsoever. That can only be considered to be a good thing, though.
55 Billion XRP Lockup is a Success
After all, a lower supply of coins available for purchase can only push the XRP price up over time. Whether or not that will be the case, remains to be determined. It is evident the Ripple team wants to put some rumors to bed sooner rather than later. They were a responsible steward of this supply for nearly five years. During that time, they allowed the ecosystem to grow and flourish without major problems. Locking up the supply is another indication of how the team wants to go about things moving forward.
The company explains this lockup as follows:
“This move underscores Ripple’s commitment to building XRP liquidity and a healthy and trusted market. Long term, the value of digital assets will be determined by their utility. XRP has emerged as the only digital asset with a clear institutional use case designed to solve a multi-trillion dollar problem – the global payment and liquidity challenges that banks, payment providers and corporates face.”
As part of this escrow lockup, the funds are secured for an allotted amount of time or until a specific condition is met. In this case, 55 individual contracts each holding 1 billion XRP are deployed. The contracts expire on the first day of every month for months 0 to 54. This supply will then become available for Ripple to be used as they see fit. Unspent funds will be returned to the escrow rotation accordingly. It is a pretty impressive venture, to say the very least.
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