Ripple News Update
Earlier in the year, as a nod to concerns that XRP supply was too vast and alterable, Ripple promised to put 55 billion XRP coins into lockup. It has now done that.
Ripple CEO Brad Garlinghouse announced the move on Twitter, saying it was “good for supply predictability.” What he means is that investors shouldn’t be afraid of Ripple dumping its massive holdings of XRP.
That was the fear for a long time. Investors were concerned the company would cut and run when XRP prices got high enough. This, of course, was laughable.
Ripple is not a sketchy initial coin offering (ICO) dreamed up by a pair of hackers sitting hunched over their laptops in a basement somewhere. It is a five-year-old company that exercises seriousness-of-purpose at every turn.
Nonetheless, XRP has a PR problem. I’ve spoken to many investors who worry about the supply issue, and there are scores of online critiques that echo those arguments.
By locking up 55 billion XRP, Ripple is showing that it takes these criticisms seriously. Here’s an excerpt from their press release:
“By securing the lion’s share of XRP in escrow, people can now mathematically verify the maximum supply that can enter the market…this lockup eliminates any concern that Ripple could flood the market.”
However, these XRP coins aren’t gone for good. They were sealed using an escrow feature, which will steadily unlock one billion XRP coins every month for the next 54 months.
Some of you might be tempted to say, “Aha! So this is all a trick to lower our defenses. They aren’t locking up the money after all!”
Ripple was (past tense) able to dump its 55 billion XRP at any moment. That is no longer the case. Now Ripple must wait four-and-a-half years to regain its full arsenal.
Ripple Price Chart:
Investors reacted positively to the news, sending XRP up more than 11% against the U.S. dollar. This brought the Ripple to USD exchange rate to $0.254720. However, the Ripple to Bitcoin rate stayed relatively flat.
We expect demand for XRP to skyrocket at both an institutional and personal level. Add to that today’s lockup of 55 billion XRP coins, and our $2.00 Ripple price prediction looks well within grasp.