Ripple News: Is an XRP Supply Shock Really Coming? Experts Take

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Claims of an XRP supply shock have gained attention in recent weeks, driven by reports of falling exchange balances. Supporters believe lower token availability, combined with rising demand from XRP ETFs, could support a strong market move. However, several well-known voices in the XRP community are pushing back, saying exchange data alone does not reflect how XRP actually trades.

Bill Morgan Pushes Back on the Theory

Ripple advocate and lawyer Bill Morgan has firmly rejected the idea that a supply shock explains XRP’s price behavior. According to Morgan, changes in exchange balances offer little real insight into where XRP is headed next. He argues that Bitcoin’s price action remains the single most important driver, not just for XRP, but for most of the crypto market.

Morgan compares the current supply shock narrative to earlier theories around Ripple’s escrow releases, which he says were also wrongly blamed for price stagnation. In his view, XRP continues to follow Bitcoin’s lead, rising and falling with broader market sentiment rather than isolated supply metrics.

Data Sparks Questions, Not Certainty

Recent data from Glassnode shows centralized exchange holdings falling from around 4 billion XRP at the start of 2025 to roughly 1.5 billion this week. Roughly 750 million tokens were absorbed in recent months, coinciding with the launch of spot XRP ETFs that now hold about $1.25 billion in assets.

While some investors see this as evidence of long-term accumulation, others question whether the numbers tell the full story. Crypto commentator Zach Rector openly challenged the accuracy of some reported figures, saying certain exchange balances looked surprisingly low. He specifically questioned whether listings like Evernorth holding just 86 million XRP fully reflect actual liquidity across platforms.

Validators Say Liquidity Isn’t Drying Up

XRPL validator VET echoed this skepticism, arguing that there is no true XRP supply shock on exchanges. He estimates that roughly 16 billion XRP remains readily available across trading venues, far more than what selective datasets suggest.

More importantly, VET highlights how flexible XRP liquidity is. Tokens can be sent to exchanges in seconds, meaning order books can quickly expand or contract based on market conditions. As a result, price reactions often appear inconsistent, with small buy orders sometimes pushing prices higher while much larger purchases fail to stop declines.

XRP ETFs Add Fuel, But Bitcoin Still Leads

ETF inflows have clearly added a new layer to the XRP story, raising expectations of reduced selling pressure. Still, critics argue that ETF demand alone doesn’t override the dominant influence of Bitcoin.

For now, the debate reflects a familiar crypto pattern. Supply narratives can shape sentiment, but major price moves are still driven by macro trends and Bitcoin’s direction. Until that changes, XRP’s fate is likely to remain tied to the broader market rather than a true supply squeeze.