People could argue that out of all the major cryptocurrencies in the space, XRP has been hit the hardest during this bull run. This has significantly stifled its opportunity for growth.
To compound the problems, Executive Chairman Chris Larsen or other Ripple execs may have been moving at least 20 million XRP in the last day to exchanges. This equates to over $10 million.
However, this isn’t exactly a new phenomenon. Larsen and others have likely been dumping hundreds of millions of XRP on the market, and it continues to flounder.
However, compared to Ripple Labs ex-CTO Jed McCaleb, this is peanuts. McCaleb has access to billions of XRP, regularly dumping them on the market. McCaleb receives tokens based on XRP trading volume metrics, with estimations that he may be dumping up to 3 billion on the market in the coming months.
With this massive sell-side price pressure, the XRP price could greatly suffer. It seems McCaleb doesn’t really care about the future of the platform, trying to offload hundreds of millions of dollars worth as fast as he can, which he hopes to accomplish by the end of 2021.
Coin Dumps and the SEC
It appears that Ripple and its executives are becoming well known for their coin dumps, with the massive sales a likely reason the Securities and Exchange Commission (SEC) is pursuing the firm.
In the last few months, XRP has been under extreme pressure as the SEC (the US financial regulating body) has declared it a security. It requires SEC registration before Ripple can conduct sales. Larsen is one of the execs the SEC has accused of taking part in the massive dumps.
As both Larsen and McCaleb dump XRP, it doesn’t seem the problems between Ripple and the SEC will be resolved anytime soon. Both parties released a joint letter saying that they can’t come to terms with each other and fundamentally disagree with the other’s opinions. Whether or not they will settle the case out of court is unclear, but for now, it seems that both sides are gearing up for a legal battle.
Since the announcement of charges, many exchanges and Ripple partners have suspended services. When dealing with securities, companies need to undertake an additional litany of measures to comply with authorities, which many do not want to do. With dull prospects in the future and two of the most important founding team members dumping large quantities of XRP, it may be a challenging year for retail hodlers.