- XRP lawyer Bill Morgan says Ripple’s escrow system is meant to support the token’s price and not deflate it.
- He points out that the SEC recognized Ripple’s intent behind the escrow mechanism.
- Despite monthly XRP releases, the token’s price has surged, weakening the theory that Ripple manipulates the market.
The long-standing XRP escrow dump theory has come under renewed fire after XRP lawyer Bill Morgan refuted the allegations, asserting that Ripple’s escrow strategy is designed to stabilize, not suppress, the token’s price.
Morgan cited the U.S. Securities and Exchange Commission (SEC), stating it acknowledged that Ripple’s escrow mechanism was created to support XRP’s price. In a recent post on X, Morgan emphasized, “Even the SEC recognised that the escrow was intended to buttress the price of XRP, not deflate it.”
His remarks respond to critics who accuse Ripple of using its monthly token releases to manipulate the XRP market. However, Morgan maintained that these arguments fail to account for the broader facts, including market performance and trading volumes.
Ripple Escrow Strategy Under Scrutiny Again
Ripple releases up to 1 billion XRP each month from its escrow accounts. In July, 1 billion tokens were unlocked in two tranches of 500 million each. However, only a portion, typically between 200 million and 350 million, is used to support operations. The rest is returned to escrow.
According to Morgan, these controlled releases do not significantly affect market prices. In February 2025, he clarified that the released amounts make up a small percentage of XRP’s daily trading volume. He also noted that the escrow’s share decreases as the overall circulating supply increases, reducing its market impact over time.
Importantly, XRP surged from around $0.50 to over $3.00 between November 2024 and January 2025, even as Ripple continued its regular escrow releases. Morgan argued that this price action contradicts claims that the mechanism drives prices down.
Ripple’s Escrow Framework Explained
Ripple introduced the XRP escrow system in 2017 by locking 55 billion XRP. The system aimed to ensure liquidity while preventing oversupply. Each month, 1 billion XRP is made available. Any unused portion is returned to escrow under a transparent on-ledger process.
The goal is to support Ripple’s payment infrastructure and ecosystem development while preserving supply-demand balance. This long-term strategy provides market predictability and removes concerns over arbitrary token releases.
In June, Morgan also addressed and dismissed rumors about the U.S. government seizing Ripple’s escrowed XRP, calling the idea baseless.
The latest statements by Bill Morgan aim to close the chapter on the escrow controversy. His references to official SEC positions and on-chain behavior reinforce Ripple’s narrative; its escrow mechanism supports XRP’s ecosystem rather than undermining it.
Disclaimer
The content shared on KryptoVaultDaily is for informational purposes only and does not constitute financial or trading advice. We do not offer guarantees and assume no responsibility for investment decisions based on the material provided. Always research and seek guidance from a licensed financial advisor before trading cryptocurrency or investing.
