Fear, uncertainty, and doubt spread through the XRP community on Saturday, following Ripple’s move to release 1 billion tokens from the escrow account.
According to Whale Alert, Ripple's escrow unlocked 500 million, 100 million, and 400 million XRP tokens, three transactions worth $3.28 billion.
These tokens were previously held in escrow as part of a 2017 protocol aimed at stabilizing market supply. The transactions drew attention amid speculation that they would precede a massive sell-off.
“They want you to buy XRP while they sell it,” wrote CFA Rajat Soni, a popular user on X.
Soni's comment, among others, alluded to Ripple manipulating its escrow release schedule. Meanwhile, the price of XRP had been on a bullish streak, driven by positive progress in its long-standing case between Ripple and the U.S. Securities and Exchange Commission.
In this context, Ripple's CTO, David Schwartz, moved to clarify the FUD, attributing the release of the escrow to a routing activity.
“They always release on the first day of the month. You may not necessarily see any activity on the ledger just because the escrow has been released. The ledger does nothing on its own; it always waits for someone to send a transaction to activate it,” articulated Schwartz.
Community members indicated that Ripple's escrow accounts have randomly released several contracts in the last two months.
Nonetheless, Ripple's escrow system is a long-standing topic of debate, with the company holding a significant amount of XRP in the contractual agreement. Data on XRPscan shows approximately 35.6 billion XRP still held back after the release on August 9.
“...Can Ripple manipulate the release date of the escrow contract at any time? In theory, could they release the 36 billion XRP in the next 5 minutes?” posed a user.
Based on its mechanics, Ripple's escrow contract releases up to 1 billion XRP monthly, a system designed to avoid flooding the market.
It helps maintain the price of XRP, and although the system is structured and predictable, individual transactions, particularly those shown on the XRP Ledger, tend to move the markets.
