Crypto analyst X Finance Bull has laid out a detailed theory explaining why XRP’s large token supply, often criticized as a weakness, could actually serve as a powerful mechanism for institutional adoption. His analysis comes as members of the XRP community keep burning tokens to help reduce supply. Others, on the other hand, demand Ripple burn his blocked belongings to cause scarcity and cause a price spike.
The XRP supply is a ‘catalyst’ not a ‘problem’”
In an X post on March 18, X Finance Bull said observed that many people watch XRP’s substantial supply of 100 billion tokens and become alarmed, often describing it as a problem. He explained that the biggest concern about XRP supply comes from the belief that Ripple still controls a large portion of the tokensestimated at between 39 billion and 44 billion XRP.
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However, rather than seeing this as a negative, the analyst suggested that the high supply of XRP could actually be a ‘catalyst’. He argued that Ripple’s current concentration of XRP puts the company at the top an important threshold discussed in the CLARITY Actthat evaluates whether an affiliate group owns 20% or more of a digital asset.
X Finance Bull explained that Ripple’s large reserve creates a strategic opportunity to distribute between 20 million and 25 million XRP to institutional partners. Some of these include banks, liquidity providers, payment companies, central bank infrastructure partners and tokenization platforms.
As these tokens gradually transition from escrow to operational use, the analyst expects Ripple’s total XRP holdings to eventually fall below 20%. Consequently, this shift could strengthen decentralization, increase regulatory comfort, and open the door to broader institutional participation.
Building on this outlook, X Finance Bull outlined what XRP’s supply structure could look like after Ripple completes distribution. He predicted that the crypto company would own around 18 billion XRP after the transfer. At the same time, the banks would hold 12 billion, the liquidity providers about 10 billion, the exchanges about 8 billion, the payment companies about 6 billion, and the public holders about 46 billion.
The analyst further argued that when institutions receive these tokens, they would not sell them but instead use them to gain power real global settlement activities. In a real-world scenario, he said liquidity providers would maintain large pools of XRP, while payment companies would operate live corridors, all of which would support operational demand for XRP. At the same time he expects XRP will function as a bridging asset for cross-border liquidity, reducing circulating supply and supporting price growth as demand increases.
The broader case for XRP’s expected institutional future
In addition to the supply dynamics, X Finance Bull noted that several developments in practice already support the framework he described. He pointed The commodity classification of XRPwhich he noted is already active, along with about $1.4 billion in ETF inflows and about $2.3 billion in tokenized real-world assets (RWAs).
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The analyst also cited the upcoming national bank charter for Ripple and the company’s continued global expansion and corporate acquisitions as signs that the institutional layer is actively forming around XRP. Furthermore, as the CLARITY Act approaches, the new framework could play an important role in shaping how institutions view XRP and other digital assets.
Featured image from Freepik, chart from Tradingview.com