finbold.com
On the first day of every month, Ripple unlocks 1 billion XRP tokens from an escrow system programmed within the XRP Ledger. On November 1 (Wednesday), the token unlock will happen again in three transactions of 100 million, 400 million, and 500 million XRP.
Interestingly, November 2023’s unlock accrues for 1.86% of the current circulating supply of 53.56 billion XRP and part of the remaining 46.43 billion XRP tokens owned by Ripple that are still locked in escrows to be released monthly until April 2027.
Three escrows will reach finality on the last minutes of October 31, held by two known crypto wallet addresses under Ripple’s control:
- Address “Ripple (22)” — for an unlock of 100 million XRP, locked on September 03, 2019, with the transaction ID “7EF17…CDA6F”.
- Address “Ripple (22)” — for an unlock of 400 million XRP, locked on August 01, 2019, with the transaction ID “E0D06…DA8EA”.
- Address “Ripple (23)” — for an unlock of 500 million XRP, locked on September 03, 2019, with the transaction ID “0ECCB…F84E3”.
These two addresses still hold 4 billion XRP tokens for monthly escrows that will be unlocked within the next four months until March 1, 2024.
This is what Ripple did to the 1 billion XRP released in October
1 billion XRP tokens worth $550 million were unlocked, as expected, on October 1. Ripple immediately relocked 800 million (80%) of the total to escrows set to finalize by March and April 2027.
Notably, despite keeping 200 million XRP, the company spent 205 million tokens ($112.75 million) from its main address, “Ripple 1,” in October. For that, Ripple used 5 million XRP previously available in its balance from past months.
The sell-offs occurred weekly in three transactions, all sent to the same address, “ rJqiM…La8nE”:
- On October 9, paying 60 million XRP through the transaction ID “AFAB4…1FF48”
- On October 16, paying 75 million XRP through the transaction ID “2B333…81843”
- On October 24, paying 70 million XRP through the transaction ID “BDBE1…97B07”
How does the escrow system work for Ripple unlocks?
Ripple created XRP in 2012, with a capped total supply of 100 billion XRP. The company then distributed 20 billion XRP to the creators and the core team.
Ripple’s treasury controlled the remaining 80 billion XRP and promised to release these coins gradually rather than all at once. In 2017, Ripple implemented a new system to make the release of XRP more predictable and controlled.
This system uses escrows — a smart contract that locks up XRP, making it impossible to use them unless it meets certain conditions. Ripple’s condition was to release one billion XRP on the first day of each month for 55 months, for a total of 55 billion XRP.
However, despite a monthly release of one billion XRP, Ripple only spent or sold some of them. Instead, Ripple is reportedly locking up the remaining tokens each month in new escrows for future releases. The recurrent relocks extended the 55-month deadline for all XRP to start circulating.