Why XRP Supply Crashing On Coinbase Is A Good Thing For The Price

In addition, leaked claims that the exchange had requested that Ripple pay millions of dollars to list XRP in 2019 have also fueled anger within the community. Consequently, Diana reported that recent 30-day snapshots show net outflows on Coinbase ranging from 21 million to 95 million XRP, indicating that holders are moving coins to self-custody or other exchanges.

If this trend continues, Coinbase could soon become the exchange with one of the lowest XRP reserves in years. Recent actions by XRP holders also highlight the communitys unity and willingness to push back against perceived unfairness. Amid these developments, Diana has warned that the declining reserves could spark a potential supply crunch if market demand returns.

Why A Supply Crunch Could Be Good For XRP Price

A reduced XRP balance on a major exchange like Coinbase can create a possible supply shock. When fewer tokens are available for trading and buying interest rises, prices can also increase.

Typically, a tight supply combined with active demand can induce scarcity, which is historically known to trigger an upward momentum. For XRP, the recent outflow trend could position it for potential gains if buying pressure returns. Although the decline in Coinbase may seem negative initially, it could benefit holders in the long run.