XRP Burns Going to 0: Crucial Metric Plunge Raises Questions

XRP/USDT Chart by TradingView

XRP lacks a protocol-level or community-driven mechanism to speed up burns in contrast to Ethereum or SHIB. Since burn rates are nearly zero, the effect on supply reduction is essentially meaningless. This calls into question one of the bullish theories that could be applied to XRP: Scarcity through destruction. XRP is stuck in its enormous circulating supply of almost 60 billion tokens without a proper circulation removal mechanism.

XRP in descending channel

To make matters worse, the chart indicates that XRP is battling under a downward channel with important supports located at $2.99 and $2.83. Failure to maintain these levels might hasten the decline. XRPs argument for scarcity-driven growth seems weaker than ever in the absence of burns strengthening long-term fundamentals.

The decrease in burns makes it clear that unless the Ripple ecosystem can significantly expand its on-chain utility, the supply of XRP will not change much and price growth will have to come from institutional adoption or speculation rather than tokenomics. Investors are left with difficult questions regarding the asset‘s long-term prospects as XRP’s burn story fades into irrelevance.