A long-term Bitcoin holder, known as AltcoinFox, has posited that the introduction of XRP spot Exchange-Traded Funds (ETFs) could lead to a significant reduction in the available XRP supply within a matter of months. This scarcity, he argues, could pave the way for an aggressive price surge.
AltcoinFox initially suggested that there were "18 outstanding ETFs." He calculated that even if each of these ETFs attracted an inflow of $50 million daily, the collective daily inflow could reach approximately $900 million. This scenario implies that hundreds of millions of XRP could be removed from the current market supply every 24 hours.
Based on this projection, AltcoinFox anticipates that XRP could "become scarce within six to nine months," a development he believes would likely trigger a rise in its price.
However, it is important to note that currently, only four XRP spot ETFs are officially pending approval: those proposed by Grayscale, CoinShares, 21Shares, and WisdomTree. Other issuers, such as Bitwise and Canary Capital, are already operational and have collectively attracted over $400 million in inflows.
Reasons Behind the XRP Price's Lack of Reaction
AltcoinFox's perspective aligns with earlier analysis by Chad Steingraber. Steingraber's model, which was published on November 20, estimates that a group of 12 ETFs could accumulate as much as 40 billion XRP within a year. This quantity represents more than two-thirds of the XRP currently in circulation.
Steingraber further suggested that in a more aggressive scenario, where total daily ETF inflows reach $1 billion, the entire available XRP supply could be exhausted within 12 months. This depletion would likely occur unless there is a substantial and sudden increase in XRP prices.
Industry analysts have pointed out that the accumulation of XRP by ETFs often takes place in over-the-counter (OTC) markets. This means that the demand generated by ETFs is frequently hidden from public order books. Consequently, a noticeable impact on the price would only become apparent once the supply absorption driven by ETFs becomes significantly more pronounced.