David Schwartz, the CTO at Ripple, has recently stated two things the blockchain payments firm could do with its whopping XRP in the escrow wallet.
The flames of community anxiety were stoked by a crypto influencer known on X as Mr. Huber. He revealed that Ripple’s December 2023 XRP sales were three times higher than its average monthly sales.
Read Also: Citing over 40 Billion XRP Held in Escrow, Deaton Explains Why “Ripple is not going to abandon XRP”
According to Mr. Huber, in December 2023, Ripple sold 238 million XRP worth about $142 million, leaving the community with a bitter taste of a likely market manipulation.
The claim ignited fears of a company heavily reliant on offloading its XRP holdings, leaving the price and community sentiment in a precarious limbo.
Ripple’s Two Choices
Amidst the cacophony of speculation, Schwartz stepped in, offering not justifications, but a stark reality check. He laid bare the two options facing Ripple: hold onto its massive XRP stash or actively reduce it. No sugarcoating, no magical third door—just a binary path, each brimming with its complexities.
This unfiltered admission served as a much-needed wake-up call to the community, compelling them to confront the gravity of Ripple’s position. It also validated concerns about the potential downsides of holding such an immense amount of XRP.
Ripple has two choices. We can continue to hold as much XRP as we do or we can reduce the amount of XRP that we hold. There really isn't any third option. Ripple's original plan was to reduce our XRP holdings as quickly as we could.
— David "JoelKatz" Schwartz (@JoelKatz) January 8, 2024
Holding vs. Folding: The Ripple Effect on the Market
Merely holding onto its XRP wouldn’t appease the community. The looming presence of 40 billion XRP, stagnant and untouched, could stifle any potential price appreciation. On the other hand, selling off its holdings carries its own set of risks. Flooding the market with XRP could trigger further price declines, erode confidence, and send the community spiraling into despair.
Are the two choices mentioned by Schwartz the only option? Veteran crypto author Panos Mekra proposes a daring alternative. His vision revolves around handing over the majority of Ripple’s XRP to the XRP Ledger Foundation (XRPLF), a non-profit organization.
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Read Also: 800 Million XRP Returned To Escrow As Ripple Confirms Number of Months Left For Escrow Releases
The foundation would then utilize these assets to incentivize community projects, drive XRPL adoption, and ignite educational initiatives, essentially sowing the seeds for XRPL’s long-term growth.
Mekra’s proposition throws a curveball into the narrative, shifting the focus from Ripple’s profit to nurturing the entire XRPL ecosystem. This move has the potential to align the company’s interests with that of the community.
Ripple’s XRP dilemma holds far-reaching implications, not only for the company itself but for the entire XRP ecosystem. Whether Ripple chooses to retain its substantial XRP holdings, aggressively offload them, or embrace Mekra’s suggested path, the next chapter in the Ripple saga will be closely watched, analyzed, and debated.
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