Coinbase’s XRP reserves have seen a dramatic decline, leading to its exit from the list of the top 10 exchanges by XRP holdings. The exchange experienced an astonishing 83% drop over the last two months, falling from 780 million XRP to just 132.4 million XRP. This sudden shift has caught the attention of many in the XRP community.
Previously ranked as the fifth-largest holder of XRP among exchanges, Coinbase now finds itself overshadowed by rivals such as Upbit, which leads with an impressive 5.87 billion XRP, followed by Binance at 2.82 billion XRP. Other notable exchanges include Uphold with 1.74 billion, Bithumb at 1.66 billion, and Bitbank holding 575 million XRP. The list continues with Coincheck, eToro, Crypto.com, Coinone, and Kraken, all holding significant amounts of XRP.
The decline in Coinbase’s XRP reserves can be attributed to several factors. The asset has been increasingly funneled into liquidity programs, investment products, and trust accounts, thereby reducing its visibility on the exchange. Additionally, XRP tokens may have shifted from Coinbase’s wallets to institutional custody, which involves a more stable holding environment. It’s suggested that Coinbase may have also reduced its XRP holdings around the time the token reached its all-time high.
In a light-hearted observation related to this development, attorney Bill Morgan quipped that Coinbase might consider delisting XRP again, albeit in a more roundabout way by not holding any XRP at all. Coinbase’s relationship with XRP has experienced its share of regulatory turbulence. The platform suspended XRP trading on January 19, 2021, following a lawsuit by the U.S. Securities and Exchange Commission against Ripple Labs. Further complicating matters, in January 2023, Coinbase delisted XRP along with other assets like Bitcoin Cash and Ethereum Classic due to “low usage.” However, following a federal court ruling which stated that XRP sales on exchanges did not constitute securities transactions, Coinbase resumed trading in July 2023.
Despite the reduction in reserves, Coinbase has not indicated any intentions to remove XRP from its platform entirely. In fact, the recent launch of 5x leverage perpetual futures for XRP highlights a renewed interest in the token. Coinbase CEO Brian Armstrong described this move as “great progress on U.S. perpetual futures.” Furthermore, there has been speculation within the community regarding potential price manipulation by Coinbase; however, Morgan has countered these theories, noting that XRP’s price behavior has remained consistent even during periods when Coinbase had previously delisted the cryptocurrency.
Overall, while Coinbase’s XRP holdings have diminished significantly, its recent actions suggest a sustained commitment to supporting the token, raising questions about the future dynamics of XRP in the trading landscape.
