Crypto analyst X Finance Bull has presented a detailed case arguing that XRP's large token supply, often viewed as a liability, could instead act as a powerful catalyst for institutional adoption. This perspective emerges amidst ongoing community efforts to burn tokens and calls for Ripple to burn its escrowed holdings to create scarcity.
The analyst contends that Ripple's current estimated holdings of 39–44 billion XRP, representing a significant portion of the 100 billion total supply, is a strategic advantage. This concentration places Ripple above the 20% threshold discussed in the proposed CLARITY Act, which evaluates control by an affiliated group. X Finance Bull suggests this creates an opportunity for Ripple to distribute 20–25 million XRP to institutional partners such as banks, liquidity providers, payment companies, and central bank infrastructure partners.
As these tokens move from escrow into operational use, Ripple's holdings are projected to eventually fall below the 20% mark. This shift is expected to enhance decentralization, increase regulatory comfort, and pave the way for broader institutional participation. The analyst outlined a future supply structure where Ripple would hold around 18 billion XRP, with banks owning 12 billion, liquidity providers 10 billion, exchanges 8 billion, payment firms 6 billion, and the public holding approximately 46 billion.
X Finance Bull emphasized that institutions would use these tokens to power real-world settlement activities, not sell them. He envisions liquidity providers maintaining large XRP pools and payment companies operating live corridors, creating sustained operational demand. XRP would function as a bridge asset for cross-border liquidity, tightening circulating supply and supporting price growth as demand expands.
Supporting this framework, the analyst pointed to XRP's commodity classification, approximately $1.4 billion in ETF inflows, around $2.3 billion in tokenized real-world assets (RWAs), Ripple's pending national bank charter, and its global expansion as signs of a forming institutional layer.
Concurrently, a market report from 10x Research highlights a distinct capital flow dynamic for XRP. While institutional capital heavily favors assets like Solana and Ethereum, XRP is currently being propelled by "strong retail demand and expanding utility." The report notes that institutional flows remain "more cautious," with XRP ETFs registering a meager $0.6 million in weekly inflows compared to $95 million for Bitcoin ETFs and $20 million for Solana ETFs.
However, XRP compensates with significant on-chain retail adoption. Blockchain analytics firm Santiment reported that the XRP Ledger recently hit a milestone of 5.66 million wallets holding under 100 XRP, indicating robust grassroots growth.
