Ripple has been making significant strides in the cryptocurrency market, but there are growing concerns about its routine monthly token unlock. Every month, Ripple releases 1 billion XRP tokens to fund its operations, a practice that has stirred curiosity and anxiety within the XRP community. On January 1st, 2025, the first major token unlock event of the year is set to take place, and all eyes are on how this will impact the price of XRP.
Will Ripple’s Token Unlock Affect XRP Price?
Ripple currently holds a staggering 55 billion XRP tokens in an escrow account, representing nearly 55% of the total XRP supply. Each month, 1 billion XRP is unlocked, aimed primarily at providing liquidity to exchanges and partners. This strategic move helps ensure that the tokens do not directly flood the market, which could potentially disrupt pricing dynamics.
Despite concerns, historical data suggests that these unlocks do not cause immediate price fluctuations. For example, during the December unlock—one of Ripple’s largest XRP sell-offs—the price remained stable around $1.8 and even experienced a surge the following day. This price stability was influenced by several bullish factors, including the launch of the RLUSD stablecoin. Looking ahead to January 1, 2024, Ripple plans to release 1 billion XRP in three separate transactions (200 million, 300 million, and 500 million XRP), constituting approximately 1.75% of XRP’s total circulating supply.
Analysts Bullish Over XRP
Despite the impending token unlock, many analysts maintain a bullish outlook on XRP. Ali Martinez, a well-respected on-chain analyst, recently shared insights on social media, revealing that whales have accumulated an additional 60 million XRP in a mere 48-hour span. Currently, XRP is trading at $2.18, reflecting a 4% decline over the past 24 hours.
Meanwhile, Egrag Crypto, another seasoned analyst, has observed intriguing market trends. With Bitcoin’s dominance waning and Ethereum’s dominance on the rise, XRP stands poised to outperform both. XRP’s market dominance recently hit 3.93% (above the Fibonacci 0.382 level), and if it closes above the Fibonacci 0.5 level (5.57%), a significant increase in market dominance could be on the horizon.
Javon Marks, another analyst, shares this optimistic view. Marks recently emphasized that XRP has demonstrated unprecedented strength, reminiscent of its 2017 rally, suggesting even greater potential for growth.
2025: A Landmark Year for XRP?
The anticipation surrounding XRP’s future is further fueled by predictions from Bitstamp, the oldest cryptocurrency exchange globally. Bitstamp forecasts that 2025 could be a pivotal year for XRP, sparking excitement among the XRP community and the broader crypto ecosystem.
Additionally, the recent approval of RLUSD by the New York Department of Financial Services underscores the potential of the XRP Ledger (XRPL) in enterprise-level payments, real-world asset tokenization, and decentralized finance (DeFi). Ripple CEO Brad Garlinghouse has dubbed RLUSD the “gold standard for the enterprise sector,” highlighting its alignment with XRP’s growing ecosystem.
As the cryptocurrency landscape continues to evolve, Ripple’s strategic moves and XRP’s performance will undoubtedly remain at the forefront of discussions. The upcoming token unlock and market dynamics will be closely monitored, offering insights into the future trajectory of this prominent digital asset.
