Data: The number of XRP whales is decreasing rapidly

After the U.S. Securities and Exchange Commission (SEC) sued Ripple, the number of wallets holding large-scale XRP positions decreased rapidly. Industry data shows that the number of XRP whales is decreasing rapidly.

Coin Metrics, a leading cryptocurrency and blockchain data provider, estimates that the number of wallet addresses holding at least 1 million XRP has dropped from 1,721 to 1,567 between December 21, 2020 and January 3, 2021. In other words, XRP whales appear to be liquidating some of their XRP holdings amid regulatory uncertainty surrounding Ripple.

As shown in the chart below from Coin Metrics, the number of addresses holding 1 million XRP had been increasing consistently since early 2019 until a sharp drop in late December 2020. Addresses holding at least 1 million XRP hit their lowest level since October 2019.

Addresses holding at least 1 million XRP: CoinMetrics

XRP holders were upset after the SEC accused Ripple of violating investor protection laws by selling $1.3 billion worth of unregistered securities. The SEC lawsuit caused the price of XRP to fall by more than 70% as exchanges and fund managers began to distance themselves from Ripple.

On Tuesday, Grayscale Investments announced that its Digital Large Cap Fund had completely liquidated its holdings of XRP. Cryptocurrency fund manager Bitwise Asset Management abandoned its investment in XRP before Christmas.

XRP has been the lone blemish on an otherwise bullish few weeks for the cryptocurrency market. All but XRP of the top 15 crypto assets by market cap posted price gains on Tuesday, according to CoinMarketCap.

More importantly, XRP’s market cap is about to be surpassed by LTC. As Cointelegraph previously reported, LTC briefly replaced XRP as the fourth-largest cryptocurrency over the weekend. At press time, XRP’s market cap is only $140 million higher than LTC’s.

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