Recent discussions surrounding the theory of XRP token dumps from Ripple's escrow account have sparked renewed scrutiny. Legal consultant Bill Morgan has criticized these claims, providing facts and arguments.
State of XRP Escrow and its Market Impact
The XRP escrow account was established in 2017 with 55 billion locked tokens. Currently, as reported by Morgan, approximately 35 billion tokens remain in the account. Critics allege that Ripple is dumping 'hollowed-out loyalty tokens' to raise cash. Morgan refuted these accusations, emphasizing that the escrow mechanism was designed to support XRP's price.
Lawyer's Response to Criticism and SEC's Stance
Morgan stressed that even the U.S. Securities and Exchange Commission (SEC), which sued Ripple in 2020, did not pursue the legitimacy of escrow sales. He explained that the SEC acknowledged that the token releases were intended to support XRP’s price, rather than manipulate it. 'The SEC considered this to be one of the factors that would give investors an expectation of profits from the efforts of Ripple,' Morgan noted.
Control of XRP Liquidity and its Significance
In 2023, XRP supporter and CEO of Black Swan Capitalist, Versan Aljarrah, also mentioned that the controlled release of XRP tokens is aimed at maintaining liquidity and enabling access for more investors. 'Liquidity refers to the ease at which an asset can be bought or sold without significantly impacting its price,' he added, highlighting the importance of liquidity in facilitating smooth XRP ecosystem functioning.
Discussions surrounding the theory of XRP token dumps, despite differing viewpoints, underscore the need for transparency and understanding of Ripple's escrow mechanisms. Bill Morgan continues to advocate for the company, asserting that the XRP ecosystem is aimed at sustaining token stability and liquidity.
