They say you can make money by depositing XRP...Why are actual returns so low?

▲ XRP

An analysis has emerged suggesting that the structure of earning profit by depositing XRP has lower actual profitability and higher cost burden than expected.

According to a report by Bitcoinist on May 3, cryptocurrency analyst Iso Ledger specifically analyzed the profit structure and costs incurred when depositing XRP into earnXRP products. This product utilizes FXRP conversion based on the Flare Network and Upshift vaults.

According to the analysis, if an investor deposits 1,000 XRP, a fee of approximately 0.5-1% is incurred during the process of converting XRP to FXRP. Additional costs arise during the vault deposit process, reducing the actual holding to around 993 FXRP. Furthermore, network and service fees of approximately 1.149875 XRP are additionally deducted.

A redemption fee of approximately 0.5% is also imposed during the withdrawal phase, bringing the total round-trip cost to about 13 XRP. This structure means that a certain portion of the initial investment is already depleted before any profit is generated.

Although the product advertises a maximum return of 10%, the realistic expected annual return is analyzed to be around 4%. Based on 1,000 XRP, the annual profit remains at approximately 40 XRP, and it is calculated that it takes about 4 months just to recover the initial fees.

Iso Ledger pointed out that "there is a significant difference between the apparent return and the actual profit" and emphasized that investors must fully understand the structure and costs.

This analysis shows that, contrary to the perception that XRP income-generating products simply provide stable returns through deposits, there are complex cost structures and issues of delayed profits.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*