- Bitwise’s investment report outlines XRP’s value drivers as token burning, spam prevention reserves, and its potential role as a global bridge currency.
- Meanwhile, experts like Pumpius allege that XRP’s price is being deliberately suppressed by financial institutions in preparation for its integration into future financial infrastructure.
Bitwise’s investment report ignited a heated debate after a prominent crypto enthusiast shed light on a segment in which he shared with his followers on the x platform. In his tweet, the prominent voice highlighted what he called a “clear, succinct and relevant description” of the underlying mechanics influencing XRP’s price.
Alongside his revealing’s, more controversial theories have surfaced raising questions whether XRP’s market reflects its true utility.
This Bitwise investment report on #XRP has a clear, succinct and relevant description of what drives XRP’s value: 1) TX Fees, 2) Spam Prevention, and 3) Bridge Currency & Liquidity reserve for a Large Ecosystem. pic.twitter.com/x5IiHsqovx
— WrathofKahneman (@WKahneman) May 6, 2025
According to Bitwise, XRP’s value is driven by three main components: token burning through transaction fees, reserve-based spam prevention, and most crucially, its utility as a bridge currency.
- Token Burning via Fees
Every XRP Ledger transaction carries a minuscule fee which is just 0.00001 XRP. Notably, this amount is permanently burned. Although seemingly insignificant, the cumulative effect becomes substantial at scale.Over 13.46 million XRP have been burned as of January 2025. Bitwise argues that if transaction volume increased 100-fold, up to 0.75% of the total supply could be burned annually, gradually enhancing scarcity, a dynamic that has fueled growth for tokens like Shiba Inu.
- Spam Prevention and Reserve Requirements
XRP accounts require a base reserve of 1 XRP, recently reduced from 10 XRP in late 2024 to promote greater accessibility. Bitwise clarifies that this doesn’t substantially drive demand, since even a hundredfold increase in accounts would only lock up about 610 million XRP, less than 1% of total supply. Rather, it serves as a safeguard to maintain network integrity. - Bridge Currency Use Case
Perhaps the most pivotal factor is the token’s potential as a cross-border bridge currency. Bitwise underscores that XRP’s ability to facilitate fast, low-cost conversions between assets could make it indispensable in a global financial infrastructure, especially with ongoing migration to ISO 20022 standards. While still under development, this role could significantly boost long-term XRP demand if widely adopted.
The Suppression Theory: A Parallel Narrative
Bitwise’s theory has ben met by a more conspirational, yet increasingly popular view. It goes without saying that not everyone believes XRP’s subdued price is natural.
The crypto analyst being among the latter, believes that the token’s price is in this case intentionally suppressed by global financial actors.
Pumpius took the stage on the X platform with a fiery thread. According to the analyst, the token’s real value is being masked in a “controlled simulation” engineered by banks, exchanges, and regulators. He argues the asset’s utility threatens legacy systems, making it the only crypto that “needs suppression.”
He went ahead asserting that the “$2 XRP is a lie.”
https://tweet.com/pumpius/status/1919739963341525341
ccording to him, institutions are quietly accumulating XRP under the guise of stagnation. Ripple’s alleged 1,700+ NDAs and hidden banking corridors are, in his view, evidence of an ongoing accumulation phase masked from public scrutiny. He accuses exchanges of wash trading and price manipulation to maintain a facade of underperformance, especially compared to Bitcoin and Ethereum.
Notably, Bitwise’s data-driven analysis and Pumpius’s shadowy assertions paint two sides of the XRP story. One is grounded in practical mechanisms; the other in strategic control.
The post What Really Drives XRP Price? Bitwise Report and Expert Opinions appeared first on ETHNews.
