Ripple’s XRP Escrow: Burning the Supply – A Hypothetical Price Jump

A central point of debate within the cryptocurrency community is Ripple’s management of its XRP escrow holdings, which currently hold over 35% of the total token supply. Speculation about Ripple potentially burning its entire XRP held in these accounts has intensified, with some believing it could boost XRP price significantly. However, Ripple executives remain hesitant to make this move. Ripple CTO David Schwartz points out that burning billions of dollars worth of XRP wouldn’t guarantee sustained growth. He also references Stellar’s past supply reduction experiment, which failed to deliver long-term gains for its native asset XLM. Analyzing what might happen if these escrow holdings were removed, a hypothetical study by Google’s Gemini chatbot explored this possibility. The chatbot model suggests that such a move would create scarcity and potentially boost XRP market confidence, driving prices upward. However, even with an aggressive scenario where prices rise by more than 400%, it remains unlikely without exceptional market conditions. A conservative but optimistic projection indicates possible price increases of up to 50%. The chatbot emphasizes, however, that the success of a major supply reduction is not solely determined by scarcity, as market sentiment, adoption trends and broader crypto conditions also play a crucial role in determining XRP’s trajectory.