Amid prevailing bearish market conditions, Ripple Labs has drawn significant attention by securing 700 million XRP tokens in escrow, a move aimed at stabilizing market sentiment and potentially influencing XRP price trends.
Ripple Moves 700 Million XRP Into Escrow
On February 2, blockchain transaction tracker Whale Alert reported on X (formerly Twitter) that Ripple Labs had transferred 700 million XRP tokens into escrow. This process temporarily locks the tokens, making them unavailable for trading or any other use.
The timing of this escrow action coincides with a broader cryptocurrency market decline, suggesting that Ripple’s move was strategically designed to prevent a further drop in XRP prices amid bearish pressure.
Escrow Locking and Its Impact on XRP Price
Historically, Ripple’s escrow strategy has played a role in shaping XRP’s price movements:
- Escrow Locking: When Ripple locks tokens in escrow, XRP’s price often finds support and gains momentum in bearish market conditions.
- Escrow Unlocking: Conversely, when Ripple releases tokens from escrow, XRP tends to experience price declines.
Following this latest transaction, XRP was trading at approximately $2.90, reflecting a 3.60% decline over the past 24 hours. Despite the dip, trading volume surged by 65%, signaling heightened investor interest.
Bullish On-Chain Metrics Indicate Accumulation
On-chain analytics firm Coinglass reports that long-term investors are taking advantage of the recent price drop to accumulate XRP. Exchange data indicates a net outflow of $70.50 million worth of XRP in the last 48 hours, suggesting a potential buying opportunity.
At press time, major liquidation levels were:
- Lower Side: $2.791 – where $55.10 million worth of long positions could be liquidated if XRP declines further.
- Upper Side: $2.963 – where $35 million worth of short positions could face liquidation if XRP prices rebound.
Technical Analysis: Key Support and Resistance Levels
According to AMBCrypto’s technical analysis:
- Current Support: XRP is hovering at a critical support level of $2.88. If this level fails, a 10% drop to $2.55 is likely.
- Bullish Signal: XRP is trading above the 200-day Exponential Moving Average (EMA), indicating a broader uptrend.
Conclusion: What’s Next for XRP?
With Ripple’s escrow move coinciding with increased accumulation and key technical levels in play, XRP’s price action will depend on broader market sentiment. Traders should watch the $2.88 support and $2.963 resistance levels closely to gauge potential breakout or breakdown scenarios.
