Eight-year sell-off is about to end. How much money did Ripple's former CTO cash out?

Ripple (XRP), whose presence has become increasingly less noticeable in recent years, is about to usher in a "big event".

The latest data from Jed Balance shows that there are only 17,945,934 XRP left in the wallet of Ripple's first chief technology officer Jed McCaleb, which is equivalent to approximately US$5.56 million based on the secondary market price of US$0.31. Based on the average daily selling speed in recent months, Jed will probably clear his position in the next few days, which also means that his eight-year XRP selling is about to end completely.

As a member of the core founding team when Ripple was launched in 2012, Jed shared a share of approximately 20 billion XRP with Chris Larsen and Arthur Britto in the initial distribution of XRP. In 2014, due to conflicts of opinion, Jed chose to leave (and subsequently founded Stellar) and took away his own share of XRP, totaling approximately 9 billion XRP.

In order to limit the impact of Jed's selling on the secondary market of XRP, the Ripple team signed a selling restriction agreement with Jed. The agreement stipulates that Jed cannot sell more than $10,000 of XRP per week in the first year, and it will be relaxed to no more than $20,000 of XRP per week in the next three years. After that, the content of the agreement has been adjusted to a certain extent, from restricting the specific amount to restricting the number of tokens, that is, Jed is required to sell no more than 1 billion XRP during 2018-2019, and after 2020, it will be relaxed to no more than 2 billion XRP.

It is precisely because of the existence of this restriction agreement that Jed's sell-off lasted for eight years. So how much money did Jed cash out with these 9 billion XRP?

Unfortunately, perhaps due to the declining market position of XRP, most of the statistics on the cash-out value of Jed among the currently available domestic and overseas data sources have stopped before 2020. However, data sources such as Jed Balance, which have been in existence, only count the number of XRPs and do not calculate the corresponding value in combination with real-time prices. Therefore, if we want to get the answer to the total cash-out value, we still need to make an estimate ourselves.

Combined with the above picture, based on some time points when Jed stopped selling, we can divide Jed's selling into three stages: before 2021, January 2021 to September 2021, and January 2022 to present.

First, in the first stage, fortunately, Whale Alert conducted a statistical analysis of Jed’s historical selling behavior at the end of 2020 (you can read the original text for the specific algorithm, I won’t go into details here), and the result was that Jed had cashed out US$546 million through selling during this stage .

The second phase is also the period when Jed sold the most. We counted the specific amount of Jed's sales in monthly units, and then combined with the median price of XRP in that month to estimate the overall cash value. The result is that Jed cashed out a total of about 2.1697 billion US dollars in this phase . The specific calculation process is as follows:

Finally, in the third stage, continuing the calculation method of the previous stage, the result is that Jed cashed out a total of approximately US$411 million in this stage . The specific calculation process is as follows:

546 million, 2.1697 billion, 411 million, excluding the last 17,945,934 XRPs in the wallet, in the past eight years of selling, Jed's total cash value is about 3.1267 billion US dollars. It should be noted that this data is derived from the estimation model we set (the number of sales in the month * the median price in the month), and there will be some discrepancies with the actual data, but the deviation should not be too large.

Some friends may ask, with Jed's "dumping" over, can we "go for" XRP? Regarding this operation, I personally strongly advise against it for three specific reasons:

First of all, from the perspective of the secondary market alone, Jed’s continuous selling has long been one of the important selling pressures of XRP, so the end of the sell-off can indeed reduce the selling pressure of XRP to a certain extent, but compared with XRP’s average daily trading volume of hundreds of millions of dollars, Jed’s average daily selling amount in recent months is only in the millions of dollars, so how much this "certain degree" is worth considering.

Secondly, the overall cryptocurrency market has not yet stabilized, the shadow of interest rate hikes and balance sheet reduction remains, and the trauma caused by the liquidity crisis has not yet fully recovered. No one can say for sure how the market will move next.

Finally, and most importantly, in the past few years of development and competition, XRP and the concept of "cross-border payment" it represents are becoming weaker in narrative. With the advent of the Web3 era, we will continue to disprove some old concepts while proving some new concepts. Judging from the current development trend, Ripple is gradually sliding towards the latter.