XRP Shares Goes Down

Ripple Labs just released the results of its third-quarter report for 2022. In this post, we will see what happened to Ripple’s XRP holdings and why it is important for the digital asset ecosystem.

Ripple Labs sold 3 billion XRP in 2019 and just 2.6 billion XRP in 2020, which is the lowest amount of XRP sold by the company since 2016.

In total, Ripple Labs has sold about 40 billion XRP tokens since its inception. It is currently holding around 50 billion tokens, which is close to 20% of the total supply (100 billion).

While the company’s use case for selling off a portion of its holdings has been questioned multiple times over the past few years, analysts believe that it could be a good sign for investors as it indicates that Ripple might be planning to increase its use case with more payments platforms and integrations.

XRP Faces Unwanted Turmoil

A report released by Ripple Labs recently revealed that the company’s holdings of XRP had fallen below 50% for the first time since the digital asset was created.

Ripple Labs sold 3 billion XRP in 2019 and just 2.6 billion XRP in 2020, which is the lowest amount of XRP sold by the company since 2016. In comparison, Ripple sold 7 billion XRP in 2017 and 8 billion XRP during 2018, according to CoinMarketCap data.

The report suggests that this decrease could be attributed to a drop in demand for investment-related services from crypto exchanges and other financial institutions as well as reduced activity on RippleNet itself – its customized blockchain network used by more than 200 banks worldwide – due to “challenging market conditions facing companies seeking capital markets exposure through token sales.”

According to Ripple, the sales are “programmatic,” which means they’re not manual and have a smoothing effect on the market. In other words, they have a negative impact on price.

“By nature, programmatic sales have a smoothing effect on the market and give us less price visibility into where XRP is headed,” said Sagar Sarbhai, Ripple’s SVP of Government and Regulatory Affairs.