Escrow is a third party/organization that receives and holds funds on behalf of the first party and releases them at agreed intervals, with pre-agreed amounts. Instead of going for an external third-party escrow organization, Ripple chose to program escrow1Escrow. XRPL.org. (n.d.). https://xrpl.org/escrow.html on the XRP ledger with the help of a smart contract. The XRP Escrow holds XRPs and releases a fixed number of XRPs every month into the Ripple-owned wallets.
In this space today, the focus shall be on the XRP ledger escrow, tracing the escrowed Ripple wallets, and the most exciting part i.e. Ripple’s CTO, David Schwartz’s long-term view on the XRP Escrow
Why XRP Escrow?
To understand the need for escrow, we shall need to zoom in to the year 2012 when XRP was created. A total of 100 Billion XRPs were created back then, out of which 20 Billion XRPs were distributed between the core team and the developers. Having all the XRPs available all the time was seen as a concern by Ripple for unnecessary spending and market price fluctuations. Therefore, Ripple decided to escrow all the remaining XRPs. This step was applauded by the XRP community and Institutions and was envisioned as a big leap into transparency and sustainability.
Track XRP Escrow Wallets
Every month, 1 billion XRPs are released from the escrow. Ripple keeps some of the XRPs (the number varies each month) to meet its expenses and locks back the remaining XRPs in the escrow. The numbers are published by Ripple in its quarterly report. However, as promised, we shall trace for you the Ripple Escrowed XRP Wallets.
Total number of XRPs Escrowed
Out of a total of 100 Billion XRPs, around 40% i.e. 40 Billion XRPs are escrowed as of November 2023.
Let’s deep dive into the Ripple XRP wallets holding these escrowed XRPs.
Ripple Wallet 9
Ripple Wallet 9 holds a total of 5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 10
Ripple Wallet 10 holds a total of 3.5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 11
Ripple Wallet 11 holds a total of 3.4 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 22
Ripple Wallet 22 holds a total of 2 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 23
Ripple Wallet 23 holds a total of 2 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 24
Ripple Wallet 24 holds a total of 5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 25
Ripple Wallet 25 holds a total of 5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 26
Ripple Wallet 26 holds a total of 5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 27
Ripple Wallet 27 holds a total of 5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
Ripple Wallet 28
Ripple Wallet 28 holds a total of 5 Billion XRPs in the Escrow account and the escrow finish date is mentioned in the last column named ‘Finish after’.
How to Find the XRP Escrow Wallets
Now since we know the Ripple wallets holding the XRP escrow amount, let’s see how we went around and found these wallets. XRPscan.com was used to find the Ripple XRP escrow wallets. The research was done with CryptoC_James to trace all the wallets. Following is a short explanation by him on how to find the XRP Escrow wallets.
After looking at our research and the time and effort it took to trace the wallets, XRPscan.com went a step further and made it quite easier for the audience to track these wallets. They sorted out these wallets to display on the top of the list on their website. Further, the balances shown against these wallets now include the escrow as well as the non-escrow balance, making it much easier to study it.
Behind the Scenes Work in Tracing the Ripple Escrow Wallets
The following images show, how each Ripple wallet was tracked and the escrow amount was calculated before publishing this article.
Ripple’s Chief Technology Officer – David Schwartz’s view on XRP Escrow
David Schwartz shared the reason, why 1 Billion XRP was pre-determined to be released every month from the escrow. As per him, Ripple had entered the market with its offering of cross-border payments using blockchain technology, in an era when most individuals didn’t even know what a blockchain was or understood Bitcoin and Blockchain as the same thing.
Ripple knew that it would take time for the market to understand the power of the XRP ledger and On Demand Liquidity and executing a cross-border transaction is possible within 3 seconds at the fraction of the existing cost. To cover the cost of running the business, a figure of 1 billion XRPs was determined to be released every month.
What if Ripple Consumes all the XRP Released from Escrow Account
David Schwartz, CTO – Ripple Labs, considers a scenario where the consumption of XRP for meeting the expenses surpasses the XRP held in its Ripple Wallets (where all XRPs are already released into Ripple Wallets). In such a scenario, Ripple could even shut down its company since no XRP shall be left to meet its expenses however such a scenario is not possible since Ripple already has its stream of revenue sources like the CBDC platform, Digital Asset custody business (with the recent Metaco – Ripple acquisition2Metaco. (2023, May 17). Leading enterprise crypto company ripple acquires custody provider Metaco for US$250m. https://www.metaco.com/press-release/metaco-joins-ripple/, tokenization of digital assets, liquidity hub for providing liquidity for crypto assets other than XRPs and many more, to meet its expenses.
Ripple is already a profitable company and therefore chances for such a situation to arise is almost negligible. This is quite evident from the fact that the majority of the XRP’s released from the escrow are pushed back into the XRP escrow wallets.
XRP Movement After 1 Billion XRP were Released in December 2023
XRP Movement After 1 Billion XRP were Released in November 2023
XRP Movement After 1 Billion XRP were Released in October 2023
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