XRP Is Up 33% in August. Here's Why I'm Not Buying XRP at a Price of $1.44

XRP (CRYPTO: XRP) is at $1.43 as of Aug. 28, bringing its 30-day returns to 33%, but even after its wild run-up and its signs of continued momentum, I'm resolved to not buy any more of it than I already hold through the Canary XRP ETF.

In short, I don't think that the coin's recent growth has anything to do with the fundamental value of the asset itself, and I've become quite skeptical of that value overall. Here's why.

Image source: The Motley Fool.

Most of the chain's revenue isn't making it to holders' accounts

The thing that I see as driving the lion's share of XRP's price appreciation is that in mid-August, the Senate scheduled a vote on the Digital Asset Market Clarity Act for Sept. 15. If that bill passes, it's likely to benefit XRP substantially by way of laying down the rules of the road for financial institutions that want to hold and transact with crypto.

But that has little to do with XRP's ongoing ability to generate economic value and pass that value on to the people who hold it. The XRP Ledger generated $48,168 of transaction fees in Q2. Those fees are burned, and a smaller supply lifts each remaining coin's value.

But despite those burns, its circulating supply is expanding over time.

About 272 million XRP entered circulation each month in the first half of 2026 as a result of the long-standing distributions from escrow as implemented by its issuer, Ripple; the maximum supply is capped at close to 100 billion XRP. Asset manager 21Shares estimates that the network's fee revenue would need to grow by something in the ballpark of 12,700 times to offset a single year's worth of new supply hitting the market.

And that isn't about to happen.

This isn't a clear-cut issue

I can't buy more XRP in good conscience, knowing that its supply is slowly inflating, and that it could capture vast quantities of new activity, thereby demonstrating its value as a financial technology, without holders getting any upside from its success.

In other words, I don't think it's a smart idea to buy the coin, given that Ripple could pen an agreement with every large bank on the planet, and that the ledger could host a mountain of tokenized assets, without XRP becoming more valuable. The massive and unaddressed gap between the chain's success and the coin's success is too big of a deal-breaker.

On the other hand, XRP is likely to experience significant upside pressure from the regulatory and legislative catalysts that it's currently exposed to, assuming they play out as crypto insiders hope. If those catalysts spark a sustained new bull market in crypto, holding the coin will be especially lucrative.

XRP will probably be worth more in 12 months than it is today, and five years out, the odds are good that it'll be worth even more than that. However, until its supply issues are fixed, I'm all set with holding onto the stake I have and not adding more.

Alex Carchidi has positions in Canary Xrp ETF. The Motley Fool has positions in and recommends XRP. The Motley Fool has a disclosure policy.