Co-founder of Ripple causes market volatility and 10.3% price drop by transferring $175 million in XRP

Chris Larsen, one of the founders of Ripple, initiated a transfer of around $175 million worth of XRP in a ten-day span from July 17 to July 27, 2025. This movement of 50 million XRP was further analyzed by ZachXBT, who discovered that the XRP was divided among three addresses linked to exchanges and two new wallets, with a significant portion of $30 million going to Coinbase. Interestingly, this transaction coincided with XRP nearing its all-time peak of $3.65 on July 18, followed by a subsequent decline of 10.3% on July 23, resulting in the loss of $7.3 million in long positions on Binance. The market was unsettled by what was perceived as a substantial amount of XRP being released into the market within a short timeframe, with concerns raised about “exit liquidity.” JA Maartun, an on-chain analyst, particularly criticized Larsen for what he viewed as “dumping” $200 million worth of XRP over ten days. During this period, XRP’s price fluctuated between below $3.30 and stabilizing near $3.11, prompting some to question Larsen’s motives, especially given the ongoing legal disputes involving Ripple and the U.S. Securities and Exchange Commission over XRP’s regulatory classification. Despite the recent sale, Larsen still holds a significant amount of XRP, totaling 2.81 billion tokens valued at approximately $8.4 billion, although this amount has decreased from his original allocation of 9 billion tokens in 2012. With concerns about potential market manipulation looming, especially in light of the increased supply of XRP in exchanges since May 2025, the market has been on edge regarding Ripple’s future trajectory. The surge in exchange reserves of XRP from 2.75 billion to 2.98 billion tokens by July 24, coinciding with XRP’s record high, raised questions about the distribution of tokens and its impact on market sentiment. This surge led to significant liquidations in derivatives trading, with over $25.33 million in positions, including $16.42 million in long positions, being wiped out in a 24-hour period due to heightened leverage ratios. Despite the market volatility, analysts suggest that XRP’s price range of $2.9 to $3 acts as a crucial support level, potentially serving as a foundation for market stability before any further upward momentum. Comparisons between Larsen’s recent actions and the earlier XRP sales by co-founder Jed McCaleb in 2022 reveal differing approaches to handling token allocations. Larsen chose to retain a larger stake in XRP compared to McCaleb’s reduced holdings, which could have implications for Ripple’s market dynamics and leadership in the face of regulatory pressures. As XRP’s price settled at $3.11 as of July 27, market observers continue to monitor buyer activity, derivative market movements, and spot market stability to assess the short-term trajectory of the digital asset.