Analysts are discussing the possibility of a significant increase in XRP price to $4.48 if the token supply drastically reduces to 40 billion units. Let's explore the key points of this scenario.
Importance of Supply for XRP Price
Ripple's tokenomics have always raised many questions. With a current circulating supply of about 59.14 billion XRP and a total supply close to 100 billion, many criticize the high number of tokens, which they believe may hinder price growth. TheCryptoBasic notes that despite XRP's deflationary mechanism, where tokens are burned during transactions, the effect has been minimal.
Debate on Token Burning for Ripple
XRP supporters often point to Ripple's massive escrow holdings as the main lever for creating supply shock. Ripple controls around 35.6 billion XRP in escrow, worth over $100 billion at current prices. Some in the community believe that burning those tokens could launch a new phase for XRP.
Hypothetical Path to $4.48
TheCryptoBasic outlined a calculation: if XRP's market cap remains near $179 billion and circulating supply falls to 40 billion, the XRP price could theoretically hit $4.48. However, such a drastic reduction in supply would require significant action from Ripple and major holders.
The scenario where XRP could reach $4.48 is intriguing, but the road to that level looks challenging due to the large supply volumes and uncertainty in Ripple's actions.
