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Millions of Dollars of XRP are Being Shifted Off Crypto Exchanges, But What Does This Mean?

Disclaimer This article is for general information purposes only and isn’t intended to be financial product advice. You should always obtain your own independent advice before making any financial decisions. The Chainsaw and its contributors aren’t liable for any decisions based on this content.

XRP whales are on the move. This is according to an organisation called “Whale Alert”, which reports when large chunks of cryptocurrencies are being moved around. Over the past few days, millions of XRP have been moved off crypto exchanges and put into wallets, with speculation that this is an early sign that prices may be about to rise.

XRP whales — what’s happening

People who own crypto usually keep them in wallets off exchanges, simply because exchanges can be hacked and the crypto stolen, or exchanges can go bankrupt, like in the case of FTX. Investors can lose their crypto or it can get trapped on the exchange. So while exchanges are useful for buying and selling crypto, it is best to keep your cryptocurrencies off the exchange if you don’t plan to buy or sell it anytime soon.

Whales usually move their crypto from wallets to an exchange when they want to sell their coins. This usually means that the whales think that the price might drop soon so they are cashing out while the price is high.

When whales move crypto from the exchange to their wallets, this can mean that they want to hold on to the crypto for a while, because they think the price will rise in the near future.

What whales are doing with XRP

The Whale Alert twitter account reported two large transactions where large chunks of XRP — 48.8 million tokens — was moved from exchanges to wallets.

The first transaction was 25,342,122 of XRP (US$12,940,229 or AU$19,289,352) and it was transferred from the Binance exchange to a wallet.

In the other transaction, 23,500,000 of XRP (US $12,307,916 or AU$18,346,794) was transferred from the Bitso exchange into a wallet. 

Why are whales holding on to XRP?

Currently, there is battle going on between The SEC (Securities and Exchange Commission), and Ripple Labs, the company behind the cryptocurrency XRP. The SEC says that Ripple has been selling XRP in violation of US securities laws. Ripple denies this.

While the case is ongoing, and the outcome remains uncertain, a ruling is expected soon, and many people feel that Ripple has a good chance of winning.

If the SEC is successful, Ripple could face fines and other penalties, and the XRP price could be impacted. However, if Ripple is successful, it could pave the way for other cryptocurrencies to avoid being classified as securities and subject to securities laws. And it may mean that the XRP price will shoot up. With the case drawing to a close, it seems that some XRP whales presume that Ripple will win their court case.

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Where do the whale alerts come from?

Whale alert accounts usually obtain their information through various sources, including public blockchain data, exchanges, and other market data providers. 

They can also use data analytics platforms to track and analyse these transactions in real-time.

They may also rely on information from exchanges — some provide APIs that allow developers to access real-time trading data, like large trades or withdrawals. Whale alert accounts may use these APIs to monitor trading activity.

Keeping an eye on whale movements does not tell you what the markets will do, but it does let you have a good guess at what whales think the market will do. And of course, if you are into crypto, it’s a great sport to be involved in.