Bill Morgan, legal counsel for Ripple, has firmly countered claims suggesting that the U.S. government might confiscate XRP tokens held in Ripple’s escrow accounts for national reserve purposes. In response to speculation by analyst John Squire, Morgan succinctly stated, “No it won’t,” emphasizing the unlikelihood of such an action.

Technical Transfer Mechanisms and Their Limitations

While theoretical mechanisms exist to transfer escrowed XRP to government control without waiting for scheduled releases, such methods face practical challenges. An XRP Ledger validator known as “Vet” described a process involving the reassignment of account keys to enable a transfer through a single transaction. However, Ripple’s senior software engineer, Mayukha Vadari, pointed out that this approach is inflexible, permitting only all-or-nothing transfers rather than partial ones.

Update on SEC Settlement Negotiations

The legal settlement between Ripple and the U.S. Securities and Exchange Commission (SEC) continues to advance, though procedural hurdles have been encountered. The process aims to reduce Ripple’s fine to $50 million and lift the injunction against XRP sales. Upon settlement, ongoing appeals will be dismissed, concluding long-standing litigation. Importantly, the settlement acknowledges no criminal wrongdoing, which undercuts grounds for government seizure of assets.

Ripple’s Escrow Structure Supports Market Stability

Ripple maintains approximately 50 billion XRP in escrow, releasing up to 1 billion tokens monthly based on market conditions. This carefully managed system provides predictability and stability for XRP markets and institutional participants. The structure remains intact throughout the settlement process, ensuring orderly token availability.