Bullish For Ripple (XRP)? Price Keeps Increasing Despite Uptick in Circulating Supply
TL;DR
- XRP Release by Ripple Labs: In November, Ripple Labs released 1 billion XRP tokens, following their standard practice since 2017, accounting for about 1% of the 100 billion total supply.
- Supply Strategy and Circulation: Ripple increases XRP’s circulating supply monthly, with a plan to release the entire supply by April 2027, using re-locking strategies to stabilize the market.
- Market Resilience of XRP: Despite the growing supply, demand for XRP remains strong due to Ripple’s partnerships in finance and its legal battle with the SEC, contrasting with other cryptocurrencies that reduce supply to increase value.
Ripple Labs released 1 billion XRP into the Ripple ecosystem at the beginning of November. That’s according to a report from blockchain intelligence firm Whale Alert.
1 Billion More XRP Released In November
The monthly unlocking of a billion XRP tokens amounts to roughly 1% of the eventual total supply. The company released the tokens from an escrow smart contract in three tranches, according to Whale Alert data.
The first tranche unlocked 300 million tokens. The second one issued 200 million shortly after that. Then, a final release of 500 million completed Ripple’s supply increase for the month.
This has been the standard new issuance procedure for one of the world’s largest cryptocurrencies by market cap since 2017. In November, just a little over half of all the XRP that will ever be issued are currently in circulation.
Does Ripple Have A Halving?
Bitcoin price is rallying, likely because of an upcoming supply cut in April, amongst other things. New Bitcoins are mined roughly every ten minutes in a fixed amount that declines by half every four years.
Does Ripple have a “halving” event? In short, no.
Ripple Labs has been increasing the circulating supply of XRP each month since 2017. The XRP ledger has a total supply cap of 100 billion tokens since 2012 when it was founded.
If all goes according to plan, the entire supply will be in circulation after April 2027. As reported by Investing.com at the end of October:
“In the latest development in the cryptocurrency market, Ripple has extended its final escrow deadline to April 2027. The company’s original plan was to release one billion XRP each month for a period of 55 months.”
Usually, the company quickly re-locks a sizable portion of the new supply and rolls it over to the next month. This is to gradually increase circulation and prevent supply shocks from having an undue influence on the price. Ripple then usually moves the remaining tokens onto cryptocurrency exchanges.
Ripple Price Backed By Demand
Other blockchain companies like Binance burn tokens and lower supply to add value to their cryptocurrencies. So, it’s a marvel of demand for XPR tokens that the price has so much support even as the supply increases.
Ripple’s extensive business partnerships with traditional finance companies are likely a big part of the market’s love for XRP. In addition, Ripple Labs’ so-far very successful fight against the SEC in court earns XRP media coverage and elevates the blue-chip cryptocurrency’s profile and its price.
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