The post Ripple to Unlock 1Billion XRP on 1st May, Is XRP Price To Drop? appeared first on Coinpedia Fintech News
On the first day of every month, Ripple, the blockchain payments firm, unlocks a significant amount of XRP tokens from its escrow. This monthly event, scheduled for May 1, will see 1 billion XRP tokens released into circulation, valued at over $500 million. This predictable unlock has raised concerns among investors and analysts about its potential impact on the XRP market in the coming weeks.
Ripple’s regular unlocking of XRP tokens has been a recurring event since 2017, with 1 billion tokens released on the first day of each month. The upcoming unlock on May 1 follows this established pattern, utilizing escrow accounts designated as ‘Ripple (22)’ and ‘Ripple (23)’ for distribution, as indicated by XRPScan data from April’s unlock.
The monthly XRP unlock carries substantial weight within the cryptocurrency market. The impending release accounts for approximately 1.83% of the circulating XRP supply and 2.48% of the XRP tokens held in escrows under Ripple’s control, underscoring its significance in influencing supply dynamics.
Following the XRP unlock in April, Ripple executed strategic transactions to manage the released tokens. Notably, ‘Ripple (22)’ transferred 200 million XRP to the treasury account ‘Ripple (1)’ for sale.
On April 14, Ripple conducted a $48.5 million XRP sale in response to geopolitical tensions, followed by the liquidation of the remaining 100 million XRP reserved for sale on April 24.
The market impact of Ripple’s XRP unlocks is closely monitored, given its potential to affect XRP’s supply dynamics and price. A recent analysis of XRP’s price behavior amid these events reveals mixed outcomes. While certain days experienced minor gains, negative trends persisted through most of the period.
For instance, January saw a 20% decline in XRP price, followed by a 16.6% increase in February driven by limited positive trading days. March exhibited positive momentum initially but faced a significant decline post-sell-off on March 13, resulting in a 17% drop until March 20.
As Ripple’s scheduled XRP unlocks continue, the market remains attentive to potential price fluctuations and supply dynamics. The upcoming release on May 1, valued at over $500 million, is expected to have reverberations within the cryptocurrency community.
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