The Scarcity Argument for XRP That Few Are Talking About

• A leading XRP developer estimates that only 12–15 billion XRP are truly liquid and available for business use. 
• Most of the 100 billion supply is locked in escrow, lost, or held by long-term investors.
• As adoption grows, this limited supply could trigger a significant price surge due to rising demand.

Pro-XRP software engineer Vincent Van Code has broken down the circulating supply of XRP to reveal how much is truly usable for business applications like payments, liquidity provision, and cross-border settlements. 

While XRP has a total supply of 100 billion tokens, his analysis suggests the figure often referenced is misleading when it comes to practical liquidity.

Ripple’s Escrow and Strategic Holdings Restrict Circulation

Ripple currently holds around 35.9 billion XRP in escrow, releasing 1 billion each month. However, the company frequently relocks a large portion of that supply. It typically sends back to escrow around 800 million XRP per month, making most of it unavailable for active use. 

In addition to escrow, Ripple also holds 4.9 billion XRP outside of it for strategic purposes such as acquisitions and incentives. These tokens are not considered part of the liquid supply accessible to the broader market.

Billions in XRP Are Lost or Dormant

Just like Bitcoin, XRP suffers from early wallet losses. An estimated 5 to 8 billion XRP may be permanently inaccessible due to lost keys or abandoned wallets. On top of that, institutional holders, including Ripple founders and major early adopters.

Van Code suggested that these large investors collectively hold between 20 and 25 billion XRP. These tokens rarely move and are typically held in a long-term position, further shrinking the liquid supply.

Related: Crypto Author Challenges CoinMarketCap’s XRP Supply Calculation, Calls for Fairer Accounting

DeFi on the XRP Ledger is locking up even more

With the recent launch of automated market makers and the gradual expansion of DeFi on the XRP Ledger, more XRP is being committed to liquidity pools and decentralized applications. Though still in its early stages, this trend introduces an additional layer of long-term lockup, further tightening the available supply.

The most recent data from XRPScan shows that 12.48 million XRP tokens are currently locked in AMM pools.

Only 12 to 15 billion XRP may be readily available

Taking all these factors into account, Ripple’s escrow, inaccessible tokens, long-term holders, and DeFi commitments, Van Code concludes that only 12 to 15 billion XRP are likely available for immediate business use. This represents just 12% to 15% of the total 100 billion supply.

Related: XRP Supply Limit Stands: No, Ripple Can’t Just Add More

As use cases like on-demand liquidity, CBDC settlement, and asset tokenization increase, demand for XRP utility could begin to outpace available supply. With such a limited float, any meaningful surge in adoption or institutional use may result in a rapid repricing of the asset as markets adjust to the real liquidity constraints.

“Price must rise to meet demand,” Van Code concluded.