Legal consultant Bill Morgan is again lambasting chatter about Ripple’s XRP escrow dump theory after critics reacted to his X post that showed XRP escrow holdings had reduced by 20 billion tokens since 2017.Â
Ripple’s escrow account was established in 2017 with 55 billion XRP tokens locked in. As of now, per Morgan’s Monday X post, the account holds approximately 35 billion tokens. Naysayers are accusing Ripple of dumping “hollowed out loyalty XRP” to raise cash for their salaries and businesses, at the expense of token holders.
Even the SEC recognised that the escrow was intended to buttress the price of XRP not deflate it. The SEC considered this to be one of the factors that would give investors an expectation of profits from the efforts of ripple. It is one of the scores of grounds I have posted to… https://t.co/JcT6xCpFiY
— bill morgan (@Belisarius2020) July 22, 2025
“They won’t use the XRP, leaving you with bags of hollowed out loyalty tokens,” one detractor wrote.
Responding to these allegations, the lawyer noted that even the US Securities and Exchange Commission (SEC), which took Ripple to court in 2020 over alleged securities violations, chose not to pursue the matter of escrow sales further. The SEC recognized that Ripple uses the token releases to support XRP’s price, not to manipulate it.
Attorney dismisses XRP escrow dump theory
“The SEC considered this to be one of the factors that would give investors an expectation of profits from the efforts of Ripple,” Morgan explained in his X post. He added that he has repeatedly posted reasons why the theory doesn’t hold up and sarcastically noted that he might compile them into one rebuttal, or thread, “but can I be bothered?” he quipped.
The escrow consists of 55 separate contracts, each containing 1 billion XRP, scheduled to unlock monthly over a 55-month period. The release schedule began in January 2018, with one contract expiring on the first day of each month, making that month’s 1 billion XRP available for Ripple’s use.
Allegations about Ripple’s misuse of XRP are not new, but Morgan insists the evidence provided by naysayers is not enough to prove anything. In a thread dated February 27, the lawyer jotted down how XRP surged from $0.50 to over $3.00 between November 2024 and January 2025, while Ripple continued to release tokens from the reserve.
“If it needed a coup de grâce to send it to its final resting place,” Morgan wrote of the escrow dump theory, “it was the massive rise in XRP price… despite further releases.” He went on to explain that Ripple’s monthly releases represent only a small fraction of the daily trading volume.Â
“If the rate of release by Ripple remains steady and a day comes when 99% of XRP is in circulation and the escrow is down to 1 billion (1%) and Ripple releases 200 million XRP one month from escrow people will still be carrying on about the escrow dump. The theory is odious,” the advocate concluded.
XRP locks tokens to stabilize the market price
Speaking on Edo Farina’s Alpha Lions Academy podcast in January, XRP supporter and CEO of Black Swan Capitalist, Versan Aljarrah, mentioned the controlled release of XRP from the vault is meant to keep market liquidity stable and for more investors to have access to the token.
“Liquidity refers to the ease at which an asset can be bought or sold without significantly impacting its price. So by maintaining liquidity, Ripple is able to facilitate the smooth functioning of the XRP ecosystem. And that makes it more attractive to investors, traders, and potential partnerships. And that’s what this is all about,” he remarked.
