Ripple’s 17B XRP Escrow at Crossroads: Will Clarity Act’s 20% Limit Force a Sell-Off or Burn?

Ripple faces a monumental decision with its 17 billion XRP escrow. The newly proposed Clarity Act threatens to impose a strict 20% holding limit on digital asset issuers—a rule that could force the company's hand.

The Regulatory Hammer

Legislators are pushing for transparency and market stability, but the proposed cap throws a wrench into Ripple's long-standing escrow strategy. Holding billions above the limit isn't just a compliance headache—it's a potential catalyst for massive market movement.

Two Paths Forward

Selling such a colossal stash would flood the market, likely crushing XRP's price in the short term. Burning the tokens, however, would permanently remove them from supply—a deflationary move that could send valuations soaring if demand holds steady. It's the classic Wall Street dilemma: liquidate for immediate capital or destroy assets to artificially inflate scarcity. Some things never change.

The entire crypto sector watches, knowing the outcome will set a precedent. Will Ripple choose liquidity over legacy, or sacrifice supply for speculative gain? The clock is ticking.

Lawmakers in the U.S. Senate continue to work through the Clarity Act, but one section of the bill could force Ripple to cut down its large XRP escrow holdings.

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