David Schwartz posted a $1.7 million capital gains tax bill on X to counter claims that he dumped XRP on the market. The tax bill corresponds to a 2.5 million XRP sale that Schwartz said occurred in 2025, largely from bonuses earned in 2020 and 2023. The disclosure was made to address criticism that he had sold large amounts of XRP and to demonstrate that he had no hidden motive.
Sale timing and trigger
Schwartz began selling XRP as the price approached $0.10, a level he considered a trigger for profit taking. He has stated that he does not believe XRP will reach $0.25 and that he prefers to lock in gains rather than hold for long-term upside. His strategy included selling fixed slices of his holdings whenever the token hit a new all-time high, a rule he and his wife followed.
Post-sale asset reallocation
After the sale, Schwartz shifted most of his remaining XRP into Ripple stock. The move reduces exposure to exchange-side volatility while maintaining a stake in the company that created the token. Ripple stock is illiquid, but it provides direct exposure to the company’s performance without the risk of exchange-related incidents.
Implications for insiders and regulators
The tax proof serves as a public record that the sale was legitimate and that the proceeds were reported to tax authorities. It also illustrates a concrete mechanism by which a protocol founder can mitigate personal risk: converting volatile token holdings into equity and paying the corresponding tax liability. The disclosure may influence how other protocol insiders manage their token balances and how regulators view the reporting of large token sales. It also provides a data point for market participants observing the liquidity of XRP and the behavior of key stakeholders.