Institutional Demand Swallows $1.38 Billion XRP Unlock
Ripple's September XRP unlock of $1.38 billion did not send shockwaves through the market as it usually does, but instead seems to have been absorbed by a growing institutional demand for XRP.
The unlock was part of Ripple's escrow timetable established in 2017, where up to $1 billion worth of XRP is released each month. However, historical data shows that Ripple typically returns a significant portion of unlocked tokens to escrow and uses the remainder for operational expenses, institutional sales, and market liquidity.
In September, XRP traded above its pre-unlock price in the days following the unlock day, indicating a shift in market dynamics. This is attributed to strong price action and increasing XRP Ledger activity in August, as well as growing demand from institutions.
Ripple's acquisition of prime brokerage, custody, treasury, and stablecoin firms has contributed to this growth, with RLUSD reaching $2 billion in value. The company plans to build these services on cross-border settlement and institutional liquidity rather than speculative demand for XRP token.