Debate Over Circulating Supply Calculation
Ripple’s Chief Technology Officer, David Schwartz, has clarified that the company possesses the legal ability to sell or transfer the rights to receive XRP currently locked in its escrow accounts. His comments emerged in response to an ongoing community debate concerning the calculation of circulating supply for various cryptocurrencies.
The discussion was initiated when software engineer Vincent Van Code questioned why major crypto-tracking platforms, such as CoinMarketCap, exclude Ripple’s escrowed XRP from circulation figures. This is in contrast to how they count all Bitcoin, including those believed to be held in Satoshi Nakamoto’s dormant wallets. Van Code argued that this differential treatment creates a double standard. He highlighted that if CoinMarketCap were to exclude the one million BTC presumed to belong to Satoshi, Bitcoin’s total market capitalization would decrease by approximately 15%.
Conversely, XRP’s market capitalization is currently based on roughly 60 billion tokens in circulation, rather than the total 65 billion. This distinction values the asset at $157 billion with a price of $2.62 per token, instead of a potential $170 billion.
Ripple could sell the right to receive the tokens released from escrow or even sell the accounts the escrows complete into. But the XRP still can't circulate until their release dates.
— David 'JoelKatz' Schwartz (@JoelKatz) October 27, 2025
Another participant in the discussion posited that Bitcoin’s figures include all mined coins because, theoretically, they can be sold at any time. This observation led to the central question of whether Ripple’s escrowed XRP could be treated similarly, and if Ripple could liquidate those holdings before their scheduled release dates.
Schwartz Confirms Ripple’s Legal Flexibility
Addressing the core of the debate, Schwartz confirmed that Ripple does indeed have the legal capacity to sell or assign the rights to receive XRP that is currently held in escrow. However, he carefully clarified that the XRP tokens themselves cannot be accessed or enter circulation until the predetermined monthly release schedule permits it.
According to Schwartz, Ripple could potentially sell the accounts associated with future escrow releases or the contractual rights to those tokens. He emphasized that such transactions would not immediately impact XRP’s circulating supply. His explanation provided a rare and valuable insight into the legal frameworks Ripple can employ when structuring agreements related to its escrowed holdings.
Implications for Market Transparency and Institutional Interest
Public records from XRPScan indicate that Ripple currently controls approximately 35 billion XRP in escrow, a holding valued at around $92 billion. The existence of these substantial holdings has historically been a focal point of debate within the XRP community, particularly concerning Ripple’s perceived influence over market supply and future liquidity.
Schwartz’s recent statement has invigorated discussions about the potential for institutional involvement with these escrowed funds. Some analysts within the community have speculated that Ripple might already have existing agreements in place for the sale or allocation of rights to portions of its escrow, potentially targeting major financial institutions.
Others have suggested that these rights could be leveraged to back future partnerships or serve as reserves for agreements involving either government or private entities.
Ongoing Speculation Around Ripple’s Strategy
These clarifications from Ripple’s CTO follow recent reports concerning Evernorth’s plan to acquire $1 billion worth of XRP to establish an XRP reserve. While Ripple expressed its support for this initiative, the company did not specify whether its escrow holdings would be utilized for this purpose.
Market observer Nietzbux suggested that this lack of specificity might stem from Ripple having already sold portions of its escrow rights to institutional buyers. However, the company has not provided any public confirmation of such transactions.
Ultimately, Schwartz’s clarification reinforces a key point: while Ripple cannot bypass its escrow mechanism, it maintains significant flexibility in managing the financial rights tied to those future token releases. This nuanced understanding is crucial for market participants interpreting XRP’s supply metrics and Ripple’s long-term financial strategies.