In a recent discussion surrounding Ripple’s substantial XRP holdings, CTO David Schwartz shed light on the company’s strategic approach and preferences. As of September 2023, Ripple held 46.55 billion XRP, comprising 46.5% of the asset’s maximum total supply of 100 billion tokens.
The Q3 2023 XRP Markets Report, released in November, detailed Ripple’s holdings, with 5.258 billion XRP in a spendable balance and 41.3 billion XRP held in escrow. Ripple routinely releases 1 billion XRP from escrow each month but relocks 800 million shortly after, contributing to ongoing discussions about the potential impact on XRP’s price.
Ripple’s proactive efforts to reduce its XRP holdings have been evident through consistent sales. In Q3 2023 alone, the company sold 892 million XRP, prompting concerns about sustained price suppression in the XRP market. This has led to calls for alternative approaches, including the incineration of Ripple’s escrow balance.
In response to queries about Ripple’s long-term business model, a community member known as “GPD.Burn the Escrow” questioned whether XRP sales would be a perpetual aspect. Schwartz emphasized that Ripple has two options with its XRP holdings – they can either continue to hold the tokens or systematically sell them to diminish their holdings. He asserted that a third choice is not on the table, confirming the company’s goal to reduce holdings promptly.
Addressing the possibility of burning the escrow, Schwartz expressed skepticism, stating that he could not envision any event making it feasible. He further argued that such an approach would yield no benefits, a sentiment previously highlighted by Crypto Basic.
In a surprising revelation, Schwartz disclosed his preference for Ripple shares over XRP. He confirmed that he opted to receive Ripple shares instead of an allocation of XRP, although he remains uncertain if this decision was the right one. Schwartz acknowledged that if he had chosen XRP tokens, his holdings would be more liquid today.
Notably, Ripple’s shares currently boast a market valuation of around $11.3 billion. The company recently announced plans to buy back $285 million worth of its shares, with CEO Brad Garlinghouse clarifying that an IPO is not in the near future for Ripple.
When questioned about the feasibility of burning the escrow, Schwartz dismissed the idea, stating that he could not envision any scenario where it would be a viable option. He further emphasized that such an action would yield no benefits, an observation previously highlighted by Crypto Basic in a previous report.
In a surprising revelation, Schwartz disclosed that he personally preferred to receive Ripple shares instead of XRP. He clarified that, although uncertain about the decision’s merit, if he had opted for XRP tokens instead of Ripple shares, his holdings would have been more liquid at present.
This revelation sparked additional discussions within the crypto community, with community members questioning the rationale behind Schwartz’s preference for Ripple shares. The CTO defended his choice, highlighting the current market valuation of Ripple’s shares at approximately $11.3 billion. Additionally, recent reports indicate that Ripple intends to repurchase $285 million worth of its shares, signaling confidence in the company’s financial stability. Ripple CEO Brad Garlinghouse affirmed that the company has no immediate plans for an initial public offering (IPO).
As the discussions unfold, the crypto community remains attentive to Ripple’s strategic decisions, particularly the ongoing sales and the potential impact on XRP’s market dynamics. The company’s commitment to reducing its XRP holdings adds a layer of complexity to the narrative, with stakeholders eager to witness how these developments will shape the future of one of the most prominent digital assets in the crypto space.
This insider perspective into Ripple’s strategic decisions adds a layer of transparency to the company’s operations. As the crypto market continues to evolve, Ripple’s approach to managing its XRP holdings and the preference for shares over tokens could influence broader industry discussions.
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