- The recent ruling by Judge Analisa Torres, denying the joint motion filed by the SEC and Ripple, has rekindled discussions around the ownership of XRP escrow.
- A popular crypto expert has clarified that no rules currently prohibit Ripple from selling its escrowed XRP.
Judge Analisa Torres just denied the joint motion filed by the US Securities and Exchange Commission (SEC) and Ripple Labs to dissolve the permanent injunction and reduce the $125 million penalty, as noted in our recent post.
Fascinatingly, this has triggered a fresh debate among developers, blockchain analysts, and legal observers on Ripple’s unilateral control over XRP in the escrow.
According to Brad Kimes, the founder of XRPLasVegas, Torres’ ruling could pave the way for the US government to acquire the escrowed XRP for its national cryptocurrency reserve, potentially. Joining this discussion, the founder of Alpha Lions Academy, who is also a prominent XRP advocate, Edo Farina, clarified that there is no existing law that currently prevents Ripple from selling its escrowed XRP.
In a post, Farina alleged that the Bank for International Settlements (BIS), the US Treasury, and the International Monetary Fund (IMF) have acquired a substantial portion of the XRP in the escrow. According to him, the terms of the agreement date back to 2019.
Per his observation, the SEC lawsuit was unfolding at the time the Non-Disclosure Agreement was being signed. Meanwhile, he also clarified that his claims are based on “his strong reasons” rather than evidence.
No one can say with certainty that all of the escrowed XRP still belongs to Ripple. Yes, the XRP Ledger is fully transparent, anyone can verify the total supply and how much is currently held in escrow. But what we can’t verify is what’s happening behind the scenes. The ownership of the escrowed XRP is unknown.
Previous Discussions on Transferring Escrowed XRP Ownership to Another Entity
Prior to this discussion, renowned crypto influencer John Squire had disclosed that the US government may seize XRP escrow and use it for the national reserve.
However, this has been put to bed by Pro-XRP lawyer Bill Morgan, who replied that this would never happen. For another user identified as Marc, Ripple may donate XRP to the government, but may demand a re-evaluation to at least $7,500 per coin.
Earlier, prominent XRPL dUNL Validator VET explained that Ripple could give away XRP escrow ownership to the US government through a single transaction. Explaining how this could be done, VET disclosed that the key of the XRP account holding the escrow fund (37.7 billion XRP) could be set to the account of the US government, giving them full control.
Similarly, a Senior Software Engineer at RippleX, Mayukha Vadari, believes that the transfer could be done through an all-or-nothing approach.
Already, XRP has been named as part of the assets that would join the US national asset reserve along with Solana (SOL) and Cardano (ADA), as indicated in our earlier discussion. In the midst of this, the Federal Housing Finance Agency (FHFA) has asked Fannie Mae and Freddie Mac to recognize crypto holdings in mortgage applications, marking a historic move as detailed in our recent news brief.
At the time of writing this article, XRP was trading $2.188 after surging by 4.4% in the last 24 hours and 2% in the last seven days. According to our recent analysis, XRP could hit $17 in the long term. However, it would first have to breach its all-time high price of $3.4, as also explained in our previous publication.
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