According to foreign media reports, Zach Pandl, head of research at Grayscale, believes that if the XRP spot ETF follows the adoption path of Bitcoin and Ethereum spot ETFs, it could eventually absorb approximately 5% to 6% of the circulating supply of XRP. This portion of the tokens would be purchased and held in the ETF's custody account, reducing the number available for trading in the market.
Supply contraction becomes a key point of discussion
In a podcast, Pandl stated that this assessment is not about valuation levels, but rather the actual impact of continued buying of spot ETFs on the circulating shares. If funds continue to flow in, the relevant products will need to purchase real XRP in the market and hold it for the long term.
Based on this calculation method, 5% to 6% corresponds to billions of XRP. For assets with large circulating supply, such changes will not immediately alter the market structure, but during periods of rising demand, tightening liquidity may amplify price volatility.
Institutional funds follow different paths than retail investors.
The article argues that the significance of the XRP ETF lies not only in adding another investment tool, but also in providing a compliant allocation channel for pension funds, asset management institutions, and registered investment advisors. Compared to short-term trading dominated by retail investors, these funds typically hold for longer periods and have a more stable buying pace.
The report also noted a recent increase in inflows into XRP-linked investment products, with weekly inflows reaching a high not seen since 2026. This is seen as an early sign of growing institutional interest and has prompted the market to reassess the tradable supply of XRP.
The article argues that market focus is shifting.
The article argues that if ETF demand continues to expand, the market's focus may shift from whether XRP demand grows to how much trading volume remains after large-scale institutional buying begins.
This assessment is still based on trend projections, with the core premise being that the XRP spot ETF will gain sustained adoption and replicate the fund-attracting performance of Bitcoin and Ethereum spot ETFs after their approval.
