Rising questions about XRP’s true circulating supply are fueling new debate among analysts as spot XRP ETFs continue purchasing XRP.
XRP community figures Zach Rector and Chad Steingraber recently pointed out that ETFs have very few places to acquire XRP. And none of those sources include Ripple’s large escrow reserves.
The Real XRP Float May Be Far Lower Than Reported
Rector sparked the discussion by questioning XRP’s true “float,” meaning tokens freely available for trading. He argues that XRP’s effective supply is well below 10 billion XRP, far lower than the roughly 60 billion circulating supply market trackers show.
He notes that ETFs alone already hold more than 300 million XRP, suggesting that the pool of available XRP may be far thinner than most assume.
In reaction, community members offered various views on how to calculate the float. One contributor estimated that:
- Retail may collectively hold around 3 billion XRP
- Tier-1 exchanges, including Coinbase, Binance, Kraken, Uphold, and Bitru,e might hold 5–10 billion XRP
- OTC and dark-pool supply remains largely unclear
Despite differing estimates, most agreed that the true liquid supply is nowhere near the published figures. The conversation has now shifted to where ETFs can obtain XRP once OTC liquidity dries up.
Ripple’s Escrow Is Off-Limits; ETFs Cannot Source XRP There
Meanwhile, Chad Steingraber argued that XRP ETFs cannot purchase XRP from Ripple’s escrow under current U.S. rules. This restriction stemmed from the 2023 court ruling in the Ripple–SEC case.
Notably, the court stated that Ripple’s institutional sales of XRP under contracts constituted unregistered securities offerings. However, programmatic sales on public exchanges were not securities offerings.
Ripple has since received a waiver allowing it to raise capital from accredited investors, but this does not restore the ability to sell XRP directly to institutional buyers.
As a result, institutional investors and ETF issuers must source XRP from the open market, not from Ripple. Currently, Ripple holds 34,700,000,005 XRP in escrow and another 4,954,117,520 XRP in its available corporate balance.
So, Where Can ETFs Actually Get XRP?
According to analysts, ETFs have only a few realistic sourcing options:
- Tier-1 exchanges (Coinbase, Binance, Kraken, Bitrue, Uphold, etc.)
- Remaining OTC and dark-pool liquidity
- Secondary-market sellers, including retail and institutions
This limited sourcing funnel is why analysts believe XRP may face a supply crunch. With ETFs already holding roughly 300 million XRP and more issuers preparing to enter, demand is accelerating while accessible liquidity continues to thin.
Imminent Supply Shock and “Crazy” Price Action
In a separate commentary, Jake Claver said XRP ETFs are “eating through” OTC and dark-pool reserves faster than expected. Claver estimated that only 1–2 billion XRP were available privately before ETFs launched.
Given the pace of ETF accumulation, Claver believes a supply shock is not just possible but inevitable. Specifically, he predicts that XRP could see “crazy” price action as a result.
The XRP community now waits to see how quickly this potential supply crunch materializes, and whether it will impact price as widely forecasted.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
