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Talks of an XRP supply shock have picked up again, with some market participants arguing that falling exchange balances could push prices higher.
However, Vet, an XRPL dUNL validator, has rejected this view, saying exchanges still hold large amounts of XRP and that market conditions do not support the idea of a looming supply shock.
Notably, promoters of the supply shock theory often highlight declining XRP reserves on exchanges such as Binance. They believe reduced availability could limit liquidity and drive prices up. Vet has vehemently disagreed with these suggestions.
Exchanges Still Hold Nearly 16B XRP
According to Vet, exchanges currently hold close to 16 billion XRP, which remains easily accessible to traders. He explained that holders who keep XRP off exchanges can transfer their tokens to trading platforms within three to four seconds. This speed would prevent the supply from staying tight.
There is no XRP supply shock on exchanges.
1) Holders have close to 16B XRP on exchanges readily available. Plenty for anyone to get some.
2) If the price goes up or down anyone of you who has no XRP on exchanges could just send theirs within 3-4 secs to one.
3) Thus, also XRP… pic.twitter.com/mzVIluijGv
— Vet (@Vet_X0) December 28, 2025
Vet also talked about the prospect of dried-up order books. He noted that order books change constantly, and liquidity can increase or decrease within seconds, depending on market activity.
The dUNL validator pointed out that movements do not follow a fixed pattern, as buying around $10 million can sometimes lift prices, while buying as much as $100 million can still coincide with price declines.
Zach Rector, a well-known XRP community figure and supporter of the supply shock narrative, asked how confident Vet is of his figures. He said some of the numbers looked unexpected, highlighting Evernorth, which reportedly holds about 86 million XRP, as an example that raises doubts.
Vet said he remains confident that his figures represent the minimum amount of XRP on exchanges, not the full total. He explained that exchanges often control more wallets than those publicly identified.
Four Major Exchanges Hold 10B+ XRP in Select Wallets
As a result, actual exchange balances likely exceed what on-chain data currently shows. To support his point, Vet highlighted Upbit, noting that just four XRP wallets linked to the exchange already hold about 2 billion XRP.
Data from XRPScan supports Vet’s position. The blockchain explorer shows that Upbit controls 12 wallets with at least 1 million XRP each, holding a combined 6.256 billion XRP.
Binance and Binance.US together control 13 wallets at that level, holding 2.5 billion XRP. Uphold also has four wallets with at least 1 million XRP, totaling 1.679 billion XRP. Altogether, these four exchanges hold 10.435 billion XRP in wallets with balances of at least 1 million tokens.
Responding to Vet, Australian attorney and XRP community figure Bill Morgan said the supply shock theory cannot accurately assess XRP price movements, much like earlier claims that Ripple’s escrow activity controlled prices. Morgan argued that Bitcoin’s price action remains the main driver of XRP and broader crypto market trends.
I have criticized the supply shock theory as much as I previously criticized the inane Ripple escrow dump theory. Neither have any significant explanatory value in understanding XRP price movements. What does have explanatory value is what bitcoin’s price is doing? That is the… https://t.co/zyIHgVKxt8
— bill morgan (@Belisarius2020) December 28, 2025
Proponents of the Supply Shock Theory
The latest comments from Vet and Morgan come on the back of recent discussions surrounding the supply shock theory. In October, Zach Rector, who has also suggested that XRP could hit $100, said the progress around Flare’s FXRP project shows the supply shock theory is no longer a meme.
Meanwhile, in September, Versan Aljarrah, founder of Black Swan Capitalist, claimed major institutions, including JPMorgan, have quietly accumulated XRP. He suggested this accumulation could lead to a supply shock and advised investors to hold their tokens.
The recent launch of XRP ETFs has also bolstered confidence. These ETFs have attracted $1.14 billion in net inflows over 30 straight days, leading community figures like Chad Steingraber to suggest institutional demand could reduce available supply.