XRP News Today: XRP Price Drops 9% Amid Supply Shrinkage Concerns

XRP, the fourth largest cryptocurrency by market capitalization, has seen significant fluctuations, reaching a high of $3.38 and currently stabilizing around $2.50. While some investors are concerned, others view this as a temporary pause. However, there is a growing speculation that this could be the last opportunity to acquire XRP before it becomes scarce on exchanges.

A well-known analyst, Aduino Fina from Alpha Lions Academy, predicts that XRP is on the brink of a significant supply shock. This means that XRP could become so scarce that even large investors may struggle to obtain it. This phenomenon is due to the fact that a small amount of XRP, specifically 0.00001 XRP, is burned and permanently removed from circulation with each transaction.

Data from CryptoQuant indicates that Binance's XRP reserves have decreased from 2.94 billion coins at the beginning of the year to approximately 2.86 billion coins currently. This reduction of 82 million XRP in a few months, although seemingly small, contributes to the overall shrinkage of the total supply over time.

In addition to these burns, more individuals are withdrawing their XRP from exchanges to store it securely in private wallets. Since January, Binance has seen a withdrawal of 183 million XRP. In January, when XRP reached a seven-year high of $3.30, Binance's hot wallet held over 3 billion coins as many rushed to sell. However, as the hype subsided, these coins began moving to cold wallets and other secure storage solutions.

Adding to the potential scarcity, there is a 90% chance that an XRP ETF will be approved by the end of 2025. If this happens, banks and large money managers will likely rush to acquire as much XRP as possible. With less XRP available on exchanges and increased demand, prices could surge rapidly. Many believe this could be the last chance to acquire XRP before it becomes harder to find and more expensive.

Crypto expert Cheeky Crypto advises investors to only invest what they can afford to lose and to remember that significant market movements take time. Currently, XRP is trading around $2.14, down 9% in a week, with a market cap of $125 billion. This could be an opportune time to buy more XRP while prices are relatively low. Additionally, if Ripple secures new deals with banks in Asia and the Middle East, it could further boost XRP's price and usage.