|Sep 13, 2018 03:00 PM||By: John Patrick Mullin | 2312 Views|
Ripple Labs and XRP II LLC have achieved with the R3 blockchain consortium after a drawn-out constitutional conflict over the sale of 5 billion Ripple tokens (XRP) at USD 0.0085 each. The fact that such a vast amount of XRP was offered to R3 at such a massive discount shows the centralized nature of the business.
Ripple Labs and XRP II allowed with R3 to sell up to XRP 5 billion any time before the end of 2019. R3 leads 200 blockchains, and distributed ledger technology analysis firms and companies, and mainly examines the use of such technology for finance and business. XRP is a cryptocurrency for cross-border fees, which makes it a good fit for finance and commerce platforms.
Ripple had started into this deal to sell XRP 5 billion for only USD 42.5 million when the price was close to that level. Cryptocurrency prices surged massively, and by September 2017 the deal no longer made sense. As the peak of the crypto rally, the XRP was worth USD 19 billion, and even now after a massive price crash during 2018 they are still deserving USD 1.3 billion.
It would be catastrophic for the XRP market for this deal to go through as allowed, so it makes sense that Ripple Labs and XRP II decided to get rid of the contract. There are just under 40 billion XRP in the passage, and the dose of 5 billion into flow could lead to a significant price crash. It is far if the lawsuit settlement required a large amount of cut-rate XRP starting circulation.
This position highlights the centralized nature of XRP. While there is nearly 40 billion XRP inflow, there are over 60 billion XRP under the control of Ripple Labs and the Ripple Foundation that are not yet in distribution. This is quite bad for investors since these centralized Ripple items could legally dump tokens at any time and suck all the money out of the market. This action is a case of how Ripple can sell billions of its tokens below market rate, which is breaking to its market.
While XRP has consistently been one of the best cryptos, currently #3 with a market cap of USD 10.6 billion, many crypto specialists and supporters don’t consider it to be true crypto due to its lack of mining and organization of coin supply.