- Digital Asset Investor alerts community about potential XRP supply shock.
- Axelar’s mXRP and Flare’s FXRP target billions of tokens for staking.
- Exchange reserves drop while institutional accumulation accelerates.
Digital Asset Investor has issued a warning to the XRP community about a potential supply shortage driven by new staking initiatives. The alert comes following the launch of mXRP, a yield-generating product developed by Axelar Network that allows users to earn rewards on their XRP holdings.
The community figure highlighted two separate interviews that revealed ambitious acquisition targets from both Axelar and Flare Networks. These projects aim to remove substantial amounts of XRP from active circulation through their respective staking mechanisms, potentially creating market pressure on available supply.
Staking Projects Set Ambitious Token Targets
Georgios Vlachos, co-founder of the Axelar Foundation, outlined success metrics for mXRP during a recent interview with Eleanor Terrett from Crypto in America. The project seeks to capture approximately 5% of XRP’s total supply through its staking platform, which would equal roughly 3 billion tokens.
Flare Networks has set an even larger goal for its FXRP staking product, targeting 5 billion XRP tokens. Combined, these two projects could lock up approximately 8 billion coins, which represents about 13% of the current circulating supply.
Current adoption remains limited, with mXRP holding only 3.851 million XRP across both the EVM Sidechain and XRP Ledger. The majority of these tokens, approximately 2.786 million, are stored on the sidechain. This figure represents just 0.006% of circulating supply compared to the project’s ambitious targets.
The supply concerns coincide with declining XRP balances on major cryptocurrency exchanges. Coinbase’s XRP reserves have contracted dramatically over recent months, falling from 970 million tokens across 52 cold wallets in June to just 32 million coins in two wallets by September 20.
Analyst 24HrsCrypto has calculated that Ripple currently controls 37.3 billion XRP through escrow arrangements plus another 3.5 billion in liquid holdings. Company executives Chris Larsen and Arthur Britto hold 2.3 billion and 1.3 billion tokens respectively, accounting for 44.4% of total Ripple coin supply.
Institutional investment has also begun accumulating positions in XRP. Purpose ETF holds 29.6 million tokens while Canadian investment manager 3iQ maintains 45 million coins. The analyst estimates retail investors control no more than 15% of total supply.
