- Critics argue Ripple’s large escrow holdings could deter institutional adoption.
- Bill Morgan says XRP’s escrow structure provides market certainty rather than harming investors.
- Morgan calls 2018 ATH comparisons a fool’s errand, given deeply immature markets.
A debate over Ripple’s XRP escrow arrangement has resurfaced on X, with pro-XRP lawyer Bill Morgan pushing back against critics who argue that the company’s large escrow holdings dilute XRP’s value and discourage institutional adoption.
Critics Say Escrow Discourages Institutional Adoption
Blockchain specialist Spade argued that Ripple’s large escrow holdings remain a barrier to institutional participation. He claimed major firms would be reluctant to acquire significant amounts of XRP while a single company controls such a large share of the supply.
“If you want institutional adoption, they have to relock it,” Spade said. “No major firm on earth is going to acquire any significant amount of XRP knowing that one company controls that magnitude of the supply. You either burn the escrow, or relock it.”
Morgan: Escrow Has Not Hurt XRP’s Market Standing
Morgan argued that the escrow structure has provided the market with predictability rather than harm. He added that Ripple’s percentage ownership is steadily declining with each monthly release, as a portion of the unlocked XRP remains in circulation rather than being returned to escrow.
“Whatever else you can say about the escrow, it has not stopped the market keeping XRP in the top 10 cryptos by market cap for almost nine years since the escrow accounts were first secured,” Morgan said. “It is one of several key certainties about XRP and markets like certainties.”
Spade Challenges Morgan’s Market Cap Argument
Spade pushed back on Morgan’s claim that XRP’s long-standing top-10 ranking proves the escrow has not harmed the asset.
According to Spade, XRP traded between $3.66 and $3.84 during the 2017-2018 cycle with a market cap of about $140 billion. In 2025, XRP reached a similar price near $3.65, but its market cap had expanded to roughly $210-220 billion. He argued the difference reflects the larger circulating supply, suggesting that more capital was required to achieve the same price level.
“XRP needed 50% more market cap to retest its 2018 high,” Spade said. “That trend will continue for the foreseeable future.”
Morgan Pushes Back on the ATH Comparison
Morgan rejected the 2018 price comparison as a reliable benchmark, arguing that those peaks reflected an immature and speculative market rather than any fundamental valuation.
“Comparing any pre-2017 altcoin by its 2018 ATH is a fool’s errand,” he said. “Those prices were grossly inflated and the outcome of a very immature market. The percentage increase in XRP since 2013 until today is enormous despite the matters to which you refer.”
He also acknowledged a broader possibility that most pre-2020 cryptocurrencies remain overpriced on any rational measure, while still maintaining that at least some will benefit from another boom cycle.
Retail Frustration Boils Over
Not everyone in the thread was interested in the academic debate. Community members were more direct, saying the escrow discussion misses a simpler point for retail holders.
“Who gives a damn about XRP being in the top ten if the coin can’t break $4,” they wrote, adding that Ripple had effectively disadvantaged retail investors by holding onto the escrow while deflecting criticism with optimistic narratives.
What the Escrow Actually Does
At the center of the debate is a mechanism Ripple set up years ago to lock the majority of XRP supply in a series of time-released escrow accounts. Each month, a set amount is released, with any unused portion typically relocked for future release. The arrangement was designed to give the market visibility into future supply, but has become a recurring flashpoint as XRP has struggled to sustainably clear price levels that would surpass its 2018 peak on a market-cap-adjusted basis.
Related: Ripple’s 38B XRP Escrow Could Take 9 More Years to Fully Unlock
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