Is the market underestimating the impact of XRP ETFs? With two funds already operational and several more pending launch, crypto analyst Cobb warns of an imminent supply shock for Ripple's token. Institutional flows could reshape the market dynamics, akin to what happened with Bitcoin and Ethereum.
The recent launch of two ’33 Act XRP ETFs marks a decisive turning point for the altcoin. Canary Capital and Bitwise have kicked things off, but they won’t be alone for long. This multiplication of institutional investment vehicles could create unprecedented buying pressure on an asset whose circulating supply remains limited. Cobb, a recognized crypto commentator, asserts that a supply shock is looming on the horizon, similar to what was observed with Bitcoin after the launch of its spot ETFs in January 2024.
The comparison with Bitcoin and Ethereum is no coincidence. BTC approached $110,000 after the arrival of ETFs, while Ethereum recorded substantial gains thanks to massive institutional capital inflows. Yet the market seems to be ignoring that XRP could follow a comparable trajectory, or even more explosive considering its more modest market cap and relative liquidity.
Data from SoSo Value reveals that the first two XRP ETFs recorded a peak net inflow of $245 million on Canary Capital’s first trading day. This figure remains modest compared to predictions from Steven McClurg, CEO of Canary, who anticipates $10 billion in inflows during the first month under favorable market conditions.
Daily inflows have slowed since the initial launch, primarily due to the correction in the broader crypto market. This temporary decline does not necessarily reflect the real institutional appetite for the asset. Traditional asset managers typically integrate new investment vehicles gradually into their allocations, a process that can take several weeks.
Crypto analyst Chad estimates that the funds could attract up to $1 billion in daily net inflows eventually, with $500 million coming directly from altcoins converted into reserves. At this rate, maintaining XRP’s price around $2 would become mathematically impossible without a significant increase in available supply on exchanges.
Eric Balchunas, senior analyst at Bloomberg, confirms that Grayscale will launch its XRP ETF on November 24 via NYSE Arca. Franklin Templeton is also expected to enter the market as early as next Monday according to James Seyffart, creating competitive dynamics among top-tier asset managers.
The filing of Form 8-A by 21Shares signals that a third major player is only awaiting CBOE certification to begin operations. This rapid multiplication of funds creates competition for acquiring available XRP tokens on the secondary market. Each manager must build their initial reserves, generating concentrated buying pressure over a short period.
The supply shock mechanism relies on a fundamental imbalance: ETFs remove tokens from circulation to lock them in custody, reducing the supply available for trading. If demand remains stable or increases while supply contracts, the price mechanically adjusts upward. Chad predicts a target of $220 for XRP, based on the fact that Bitcoin nearly doubled post-ETF and that the relative impact on a mid-cap asset should be proportionally greater.
Buy XRP for the long term with Pionex bots to generate returns up to 180% annually without doing anything. In this volatile but bullish context, investing in XRP through Pionex’s automated trading bots proves to be a smart strategy to maximize returns before the market reaches its peak. Here’s a structured explanation of the main reasons.
Unlike manual trading, which is limited by time and emotions, these bots operate continuously on the XRP/USDT pair, generating cumulative profits even on small variations (for example, 0.5-2% per trade). Test them now for free:
XRP’s supply structure presents peculiarities that amplify the risk of shortage. Approximately 55 billion tokens circulate freely, while Ripple still holds a significant reserve in escrow. Centralized exchanges generally maintain limited reserves to manage daily liquidity, making massive ETF acquisitions potentially disruptive.
On-chain data shows that XRP reserves on major platforms have already decreased by 12% over the past three months. This trend precedes even the ETF launches, suggesting that investors are anticipating the rise and accumulating in self-custody. The arrival of institutional flows could accelerate this withdrawal movement from exchanges.
The market is currently trading XRP around $2.04, up 5% over 24 hours. This technical consolidation occurs in a context of generalized crypto market correction. Support levels are situated between $1.80 and $1.85, while a break above $2.10 could trigger an accelerated move toward the $2.50 zone.
Related:
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
DISCLAIMER
This article is for informational purposes only and should not be considered as investment advice. Trading cryptocurrencies involves risks, and it is important not to invest more than you can afford to lose.
InvestX is not responsible for the quality of the products or services presented on this page and cannot be held liable, directly or indirectly, for any damage or loss caused by the use of any product or service featured in this article. Investments in crypto assets are inherently risky; readers should conduct their own research before taking any action and invest only within their financial means. This article does not constitute investment advice.
Risk Warning : Trading financial instruments and/or cryptocurrencies carries a high level of risk, including the possibility of losing all or part of your investment. It may not be suitable for all investors. Cryptocurrency prices are highly volatile and can be influenced by external factors such as financial, regulatory, or political events. Margin trading increases financial risks.
CFDs (Contracts for Difference) are complex instruments with a high risk of rapid capital loss due to leverage. Between 74% and 89% of retail investor accounts lose money when trading CFDs. You should assess whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Before engaging in financial or cryptocurrency trading, you must be fully informed about the associated risks and fees, carefully evaluate your investment objectives, level of experience, and risk tolerance, and seek professional advice if needed. InvestX.fr and the InvestX application may provide general market commentary, which does not constitute investment advice and should not be interpreted as such. Please consult an independent financial advisor for any investment-related questions. InvestX.fr disclaims any liability for errors, misinvestments, inaccuracies, or omissions and does not guarantee the accuracy or completeness of the information, texts, graphics, links, or other materials provided.
Some of the partners featured on this site may not be regulated in your country. It is your responsibility to verify the compliance of these services with local regulations before using them.
