Recent discussions focus on the potential impact of XRP's burn mechanism on its price, compared to Bitcoin's scarcity model.
XRP Burn Rate
Since the launch of the XRP Ledger in 2012, just over 14.18 million XRP have been burned. This is only 0.014% of the total supply of 100 billion tokens. Currently, the network burns around 2,700 XRP per day, which equals about one million tokens a year. At that rate, it would take nearly a thousand years to burn one billion XRP.
Hypothetical Price Impact of XRP
If XRP operated like Bitcoin during halvings, potentially halving the supply to about 30 billion tokens while maintaining demand could lead to a price increase to around $6.12. If the market cap multiplied, the price could rise to approximately $15.30.
Limited Potential of XRP
However, XRP’s burn mechanism is designed to ensure network security and prevent spam, rather than price manipulation. All 100 billion tokens were created initially, and Ripple controls a significant portion. Redesigning the system would be a substantial challenge and is considered impractical.
In conclusion, XRP's price largely depends on its adoption and market demand rather than forced scarcity events.
