Ripple Labs moved 700 million XRP token to Escrow account. The analysis of the potential impact of the transfer on the XRP price is as follows…
Locking and Market Effect of 700 Million XRP
Whale Alert, the block chain analysis platform, announced on February 2 that Ripple Labs has carried 700 million XRP to Escrow (trust) account. This means that the tokens cannot be used for a certain period of time and will remain closed to trade.
This movement took place as a general decline in the crypto money market. Apparently, Ripple aimed to prevent possible harsh decreases in the XRP price with this move.
Effect of Escrow on XRP Price
Ripple Labs’s previously escrow locking operations have provided a temporary recovery in the XRP price. Historical data show that the restriction of supply due to locked tokens can support prices in markets that tend to decline. However, when Ripple then releases the tokens from Escrow accounts, a decrease in the price of XRP is usually observed.
After this final process, the XRP is traded at $ 2.90 and has decreased by 3.60 %in the last 24 hours. However, despite the decrease, investor interest increased and the transaction volume increased by 65 %.
On-Chain Data and Investor Behavior
According to Coings, the On-Chain Analysis Platform, some long-term investors considered price decrease as an opportunity to purchase price. 70.50 million dollars of XRP output from the stock exchanges show that investors have saved.
According to the stock market liquidation map, if the XRP declined to $ 2,791, the long position of about $ 55.10 million has a risk of liquidation. On the other hand, if the price increases to $ 2,963, the liquidation of the short position of approximately $ 35 million may be involved.
Technical Analysis and Future Scenarios
According to the technical analysis, Ripple is currently at a critical $ 2.88 support level and seems to be weakened.
If this support level is broken, the XRP is likely to decrease by 10 %to $ 2.55. However, in the positive scenario, the XRP is traded on the daily graph on the 200 -day exponential moving average (EMA), which shows that it can maintain a long -term rise trend.
