According to a report published on Monday in the Wall Street Journal (WSJ), Jed McCaleb, one of the co-founders of both Ripple and Stellar, has recently stepped up sales of the billions of XRP tokens that he is thought to own.

When McCaleb left Ripple in 2013, he had around nine billion XRP tokens as well as shares in Ripple.

On 21 May 2014, McCaleb said that he had given some of his XRP tokens to various charities, and that he was planning to sell the entirety of his remaining XRP tokens. According to Finextra, the news of this announcement caused the XRP price to drop by as much as 65% in the following 24-hour period. It is a clear that he wanted to send a message that he wanted to sever his ties with XRP as soon as possible.

On 14 August 2014, Ripple revealed that following “Jed’s stated intention to sell his XRP, Ripple Labs reengaged Jed to ensure responsible distribution of his XRP stake in a way that helps grow the Ripple ecosystem” and that Jed had agreed “to lock-up terms for his XRP.” Ripple explained that Jed was not allowed to sell more than:

$10,000 per week during the first year

$20,000 per week during the second, third and fourth years

750 million XRP per year for the fifth and sixth years

1 billion XRP per year for the seventh year

2 billion XRP per year after the seventh year

However, starting in April 2015, Ripple started alleging that Jed and members of his family were in violation of the aforementioned agreement. This legal dispute was finally resolved in February 2016 with a settlement deal announced in a post (“Final Settlement with Jed”) published on 11 February 2016 on the main Ripple forums. These were the terms of the new agreement reached with Jed:

Ripple will release any claim it has on the funds currently deposited with the federal District Court for the Northern District of California and Stellar will take possession of these funds. Jed will donate 2 billion XRP to a charitable donor-advised fund (“DAF”) of his choice. The same limits are placed on the ability of the charity to sell the XRP as are placed on the Jed's ability to sell his remaining XRP. All of Jed and his children's remaining XRP, approximately 5.3 billion XRP, will be placed in a custody account at Ripple. While Jed retains full title and ownership of his remaining XRP, Ripple will control the release of his XRP in a manner consistent with the settlement agreement. Specifically, Jed will be allowed to sell his remaining XRP in the following manner: – for the first year of the agreement Jed and the DAF will be able to collectively sell 0.5 percent of the Average Daily Volume of XRP for each day of the week, including weekends and holidays.* – for the second and third years of this agreement, Jed and the DAF will be able to collectively sell for each day of the week 0.75 percent of the Average Daily Volume. – for the fourth year of the agreement, Jed and the DAF will be able to collectively sell for each day of the week 1.0 percent of the Average Daily Volume.

for any time after the fourth year of the agreement, for each day of the week Jed and the DAF will be able to sell 1.5 percent of the Average Daily Volume.

In a blog post published on 12 February 2016, Jed explained how he felt about this new agreement:

I fully complied with the previous agreement but now I have better terms for the amount of XRP I’m able to sell. The new rate is a percent of daily volume. This results in a higher limit given recent trading volume and allows for significant increases in my selling ability as volume increases, something that was not possible before with the prior agreement’s flat dollar limit. To effectuate this, I have escrowed my XRP.

I can finally donate 2B of my XRP to charitable causes, something I was unable to do under the prior agreement. This allows me to continue to fund more charities like Give Directly and MIRI which has been something I was actively doing prior to the previous agreement.

As part of this settlement, I finally sold the rest of my Ripple equity. Ripple was required to find a buyer for me at a great price.

WSJ says that Jed’s “continuing sales of the [XRP] token have dramatically risen over the past few weeks,” and that “a founder’s increasing sale of XRP could be a negative for the token’s value, just as it would be if a CEO of a publicly traded company suddenly started dumping shares in the company’s stock.” Apparently, after being contacted by WSJ, Jed wrote in an email: “I’m not selling more than I have agreed to with Ripple.”

WSJ reports that, Jed, now in the third year of the agreement, was previously selling at or below the 0.75% of the average daily volume cap “according to the XRP Ledger and his publicly-known XRP address”, but “starting in late August, his sales dramatically rose by the day.”

More specifically, it claims that:

In July, Mr. McCaleb was selling 20,000 to 40,000 XRP a day. However, starting in August, according to a public clearinghouse of token trades, he started selling 499,312 XRP a day, and at one point sold 752,076 a day. In other words, each day he moved and sold about 35 times the limit outlined in his 2016 agreement with Ripple. For example, over six days ending Wednesday, Mr. McCaleb sold more than 500,000 XRP a day, or about $150,000. The average daily trading volume of XRP on the Ripple consensus ledger—which is how Mr. McCaleb’s cap is calculated—hasn’t changed considerably in recent months and not enough to account for the change in his daily sales.

Kyle Samani, co-founder and managing partner at Multicoin Capital, had this to say about the WSJ report:

Jed McCaleb is selling more XRP than he is supposed to according to the 2016 agreement he has with Ripple Inc Jed is the the single largest individual holder of XRP. He can absolutely *decimate* the price if he chooses, and he has motivation in the form of Stellar to do so https://t.co/NgOyO3yUXq — Kyle Samani (@KyleSamani) September 24, 2018

According to data from CryptoCompare, XRP is currently trading at 0.45, down 12.23% in the past 24-hour period.