Ripple unlocked 400 million XRP, valued at approximately $1.136 billion, triggering a significant market reaction. The sudden release from escrow led to a sharp drop in XRP’s price, which fell by more than 24.6% within 24 hours.
The market downturn coincided with reports of whale sell-offs, adding to the bearish momentum.
Also Read: Another XRP Crash Coming? See This Analysis
XRP Price Declines as Whales Sell Off Holdings
Whale Alert first reported the unlock, which immediately raised concerns among investors. Market data showed that XRP whales quickly offloaded over 130 million tokens, amplifying the price decline. Meanwhile, 36crypto previously reported and warned about an expected crash in XRP price, highlighting bearish signals in technical indicators.
Ripple’s Token Release Strategy
Ripple’s monthly token release strategy is key to how the market reacts. While the company unlocks many tokens, only a fraction is sold immediately. Analysts estimate that Ripple typically sells 20-25% of the unlocked amount, with the remaining tokens locked back into escrow.
This method aims to control supply and prevent excessive price fluctuations. However, the latest release resulted in significant sell pressure, leading to a sharp downturn.
Whale Sell-Offs and Technical Indicators Signal Further Decline
The latest market data, including Santiment’s whale tracking chart shared by Ali (@ali_charts), shows a significant drop in XRP price following whale sell-offs.
The price drop aligns with a breakdown from a symmetrical triangle formation, which often signals further declines. Investors closely monitoring these patterns see the potential for further downside unless a strong recovery occurs.
Conclusion
The reaction to Ripple’s token release underscores how supply dynamics influence price movements. Despite the company’s strategy to manage supply through gradual sales, the market impact remains substantial. Investors will watch closely for any signs of stabilization as XRP navigates this volatile phase.
Also Read: XRP Could Reach This Price Once Ripple vs. SEC Lawsuit Ends
