Ripple’s strategic plan to sell 25 billion XRP has been revealed in a published whitepaper. This information has caused tremors in the market, sparking discussion and conjecture regarding possible effects on XRP’s value and the overall state of the cryptocurrency industry.
The recently released document presents a detailed plan to progressively sell a significant amount of its 25 billion tokens of XRP. The document, purportedly distributed to essential stakeholders and Ripple’s executive team members, details a tiered strategy for selling XRP. The multi-year plan includes steps to reduce the risk of market disruptions.
The plan’s principal elements include a staged Marketing Strategy To prevent massive amounts of XRP from being offloaded onto the market simultaneously. The document says that Ripple plans to sell the 25 billion in stages. The goal of this phased strategy is to avoid large price fluctuations.
Ripple Reassures Stakeholders, Critics Fear Price of XRP May Drop
A part of the XRP that will be sold will be held in escrow accounts and released according to a prearranged timetable. Critics contend that a significant sell-off may still drive the price of XRP lower with this planned strategy. There is concern that the market would respond adversely upon learning that a significant amount of XRP will eventually be sold.
Following the disclosure of the document, there was some volatility in the price of XRP. Some investors value the openness and systematic approach, thinking that providing funds for additional development and uptake will eventually strengthen the XRP ecosystem.
Others are still cautious, waiting to see if the situation affects XRP’s value in the long run. Ripple acknowledged the planned XRP sales in an official statement in reaction to the leaked document. Stakeholders were reassured by the corporation that the escrow procedures and phased approach are intended to reduce market volatility and preserve stability.
Historical Analysis Say Ripple’s Plan to Say Not New
Historical analysis of Ripple’s activities shows that this is not the first time Ripple has taken this path. It has been in the business of selling massive units of XRP for years. The sakes are also expected to continue until an undisclosed time and, thus, have a limited duration.
Ripple has continued to diversify its XRP holdings, with over 4.87 billion units of XRP ready to be spent and about 40 billion units in escrow. The amount in the escrow totals the overall XRP in the company’s reserve to more than 44.36 billion tokens.
Ripple has been stocking XRP in escrow since 2017 and has sold more than 17 billion units after moving over 55 billion units. Before Ripple locked these tokens, it had already set 61.68 billion XRP aside in a different wallet to be spent. The company is also considering more major partnerships, which is believed to trigger huge demand for the XRP.
Released Document Says Ripple Is Considering Incentives Marketing
According to the published document, Ripple is looking to allocate the remaining 75% of the XRP, worth approximately $75 billion, as at press time for promotion, marketing, and general development of the XRP system. This strategy is targeted at using the incentive marketing strategy, which requires introducing giveaways to encourage users to engage more with the Ripple protocol.
The strategy is also targeted at creating a working structure for the XRP. The strategy is expected to build a growing demand system for the XRP. The use of XRP could grow exponentially when combined with the RLUSD (Ripple USD) stablecoin.
While some stakeholders buy the idea of the XRP distribution plan, some members of the XRP community think that Ripple’s approach could have changed, considering that the published document is dated November 2014.
Some community members also believe that some elite investors have dumped their XRP on the community members and are making a profit. They also suggested that some retail investors suffer the consequences of the decline in the price of XRP.
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