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Crypto Twitter Deliberates Over the Fate of Ripple’s XRP Escrow

Published 05/16/2023, 02:32 AM
Updated 05/16/2023, 03:00 AM
© Reuters.  Crypto Twitter Deliberates Over the Fate of Ripple’s XRP Escrow
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  • Ripple’s ongoing lawsuit against the SEC raises questions about the fate of its XRP escrow account.
  • The escrow account contains over 42 billion XRP, set to be released at a pace of no more than 1 billion XRP per month.
  • Users on Twitter are deliberating if destroying the XRP escrow account would aid Ripple’s case.

The intensifying legal battle between the U.S. Securities and Exchange Commission (SEC) and Ripple has led users on Twitter to wonder if the destruction or “burning” of the blockchain’s firm’s XRP escrow account, which contains over 42 billion XRP, will help strengthen its case and allow for a quicker resolution in the lawsuit.

The deliberation was prompted by a Supplemental Brief on Remedies filed by the SEC in its lawsuit against crypto startup LBRY. The brief called for a restriction on LBRY to conduct unregistered offerings of crypto asset securities until it destroys existing holdings of its native token LBC. Destroying may include token burning, which is a known concept in the crypto space.

Ripple’s Chief Technology Officer David Schwartz responded, discussing the developments in LBRY’s case. One user asked Schwartz if Ripple’s XRP escrow account would also have to be destroyed in order to reach a settlement with the securities regulator. However, Twitter users pointed out that it wouldn’t be possible for Ripple to burn the XRP escrow.

Users on Twitter were confident that if required, Ripple could encourage network validators to initiate a token burn that would do away with the XRP escrow account, which held over 42 billion XRP as of May 1, 2023. While destroying the escrow may make it easier for Ripple to reach a favorable settlement, most users agreed that the burning would not be a simple procedure.

Ripple would either have to influence the validators to comply with the judge’s ruling or have the escrow’s monthly 1 billion XRP release sent to an address with no key. With no master key, the account would be rendered inoperable, and the tokens would effectively be burned since they wouldn’t be accessible to anyone.

The post Crypto Twitter Deliberates Over the Fate of Ripple’s XRP Escrow appeared first on Coin Edition.

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