Ripple has once again made waves in the cryptocurrency space by locking 700 million XRP tokens into escrow. This move, announced on February 2nd via Whale Alert, comes at a time when the market is experiencing downward pressure. Many are now questioning whether this action will help stabilize XRP or if it’s just a temporary measure.
🚨700 million $XRP has been locked in escrow by @Ripple🚨🔒
— Best Invest (@bestinvestx) February 2, 2025
This is part of their monthly cadence to control supply flow, ensure liquidity, and support market stability and adoption. pic.twitter.com/ULyYemiXck
Escrow Locking and Its Market Impact
By locking XRP in escrow, Ripple effectively removes these tokens from circulation, reducing immediate selling pressure. Historically, such moves have led to temporary relief for XRP, as it limits supply in the market. However, past trends also indicate that when Ripple releases tokens from escrow, price declines tend to follow.
With the crypto market currently in a bearish phase, Ripple’s decision seems strategic, aiming to support XRP’s value. Many analysts believe that this escrow action could provide a much-needed cushion against further declines.
Bullish Signals Amid Price Decline
At present, XRP is trading at $2.90, reflecting a 3.60% drop in the past 24 hours. Despite the price dip, XRP’s trading volume has skyrocketed by 65%, suggesting sustained investor interest. This increase in volume often signals potential upcoming volatility or accumulation by strategic buyers.
Furthermore, on-chain data from Coinglass reveals that $70.50 million worth of XRP has been withdrawn from exchanges over the last 48 hours. This exodus of XRP from trading platforms suggests that investors may be preparing to hold long-term, anticipating future price gains.
Technical Outlook and Support Levels
XRP is currently holding a crucial support level at $2.88. Should it break below this mark, the next significant support lies at $2.55. However, the token remains above the 200 Exponential Moving Average (EMA), a key indicator that often signals potential uptrends.
Market analysts warn that major liquidations could occur if XRP hits $2.791 or $2.963, making these levels critical to watch in the coming days.
Also Read: XRP Market Cap Hits Critical Levels: Analyst Predicts Trend Reversal Following High-Volume Dump
While the locking of 700 million XRP in escrow is a positive development for price stability, the broader market sentiment will play a key role in determining XRP’s trajectory. Investors should keep an eye on support levels and market trends to gauge XRP’s next move.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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