An XRP community commentator suggests the XRP circulating supply is lower than most think, presenting factors that could lead to further collapse overnight.
Notably, despite its recent price struggle, XRP has maintained a position above $3, boasting a market cap of around $180 billion. While Solana (SOL) and BNB trade for higher prices per token, their market caps are way below XRP’s due to the difference in circulating supplies.
Aljarrah: XRP Circulating Supply Could Collapse Overnight
Specifically, CoinMarketCap data indicates that XRP has a circulating supply of 59.61 billion tokens at press time, lower than BNB’s 139.18 million tokens and Solana’s 542.56 million tokens. In addition to this, the CMC data suggests that 40.37 billion more tokens are yet to enter the market.
Despite this reality, Versan Aljarrah, co-founder of the Black Swan Capitalist, insists that XRP’s circulating supply is actually lower than most market participants realize. He made this commentary in a recent post on X, looking to fuel the growing “supply shock” discussions within the XRP community.
According to Aljarrah, once market participants take out escrow holdings in Ripple’s accounts as well as balances held by large institutions, they will find that the XRP supply is lower than they think.
For context, Ripple holds 35.3 billion XRP tokens in escrow across 14 wallets, according to data from XRPL explorer XRPScan. Accordingly, XRPScan indicates that there are about 64.662 billion tokens in circulation, higher than the 59.61 billion presented by CoinMarketCap.
Possible Cause
Aljarrah’s recent comments suggest that while some may perceive XRP’s circulating supply to be on the high side, it actually pales in comparison to the utility of the token, which could lead to massive demand. Notably, such massive demand will likely require an even higher circulating supply, potentially leading to a supply shock and price appreciation.
According to Aljarrah, this demand could emerge from tokenized debt, stablecoins, and gold. For context, several commentaries have claimed that XRP may act as the settlement rail for tokenized versions of the real-world financial framework.
Ripple CTO David Schwartz said in 2023 that the XRPL was pivoting to this sector. Moreover, a recent Bitwise report presented the XRPL as one of the networks that could battle for leadership in the growing tokenization market. Bitwise noted that buying XRP was one of the best ways of investing in tokenization.
Amid these discussions, Aljarrah insists that once the XRPL dominates the tokenization scene, the circulating supply, which many believe is high today, could be insufficient in powering the movement of funds, leading to what the market pundit calls an overnight collapse.
This is one of the reasons several community figures believe XRP could witness a supply shock in the future. In turn, such a development would lead to greater prices, especially when demand rises alongside the dwindling available supply.
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