As many cryptocurrencies gain media attention and edge closer to mainstream adoption, XRP has emerged as a key player in the digital economy. It is the native token of the XRP ledger (XRPL), an open-source and decentralised blockchain built for fast and low-cost transactions. While often synonymous with Ripple, XRP is independent of the company. Instead, Ripple uses XRP for its digital payment solutions aimed at replacing financial systems like SWIFT. XRP’s growing institutional interest, speed and utility have ignited a debate about its position in global finance. Could XRP reshape global transactions, or will it be another coin that comes and goes?
Following Trump’s inauguration, the spotlight on crypto has emphasised the necessity of embracing digital assets. The favourable political climate has shifted in favour of crypto with Trump’s executive order to form a cryptocurrency reserve. A Truth Social media post delineating the inclusion of XRP in this strategic reserve reinforces America’s stance on crypto. This positions XRP as part of the U.S.’s plan to become the ‘Crypto Capital of the World.’
Figure 1: Truth Social post about XRP
SWIFT, the backbone of international money transfers, is often criticised for its high fees and slow processing times. The remedy to these inefficiencies is XRP, which creates the potential for Ripple’s XRP solutions to supplant traditional payment systems such as SWIFT. XRP functions as an intermediary currency that facilitates conversion between different fiat currencies. Ripple’s XRP-based payment solution, On-Demand Liquidity (ODL), allows vendors to obtain their preferred currency without requiring buyers to possess it. 
Figure 2: Payment Using On-Demand Liquidity
XRP’s functionality has led many institutions to partner with Ripple to join their RippleNet, a blockchain alternative to SWIFT. Notable partnerships include American Express, Airwallex, and SBI Remit, reflecting heightened interest in cross-border payment infrastructure. According to NASDAQ, 80% of Japan’s banks will integrate XRP into their systems by 2025, which indicates a growing interest in XRP by countries.
Ripple’s expansion efforts are amplified through its recent acquisition of prime brokerage firm Hidden Road. Handling over $3 trillion in global transactions annually and access to 300 institutional clients, this acquisition boosts Ripple’s institutional reach. By integrating crypto infrastructure with established capital flows, Ripple is building the foundation for a new phase in institutional finance. If successful, the Hidden Road acquisition could solidify XRPL as a backbone for a blockchain compatible financial system, leading to a highly bullish view of XRP.
While not primarily seen as an investment vehicle, the Teurcrium 2x Long Daily XRP ETF (XXRP) signifies burgeoning retail interest in XRP as an investment asset. It is the first XRP-based ETF and offers exposure to twice the daily performance of XRP, catering to those seeking amplified exposure to XRP.
The Securities and Exchange Commission’s (SEC) legal battle against Ripple had impeded XRP’s potential adoption rate and price. The SEC alleged that the sale of XRP could be considered an investment contract and, therefore, a security under the law. In 2023, Judge Analisa Torres partially sided with both parties, ruling that the sale of XRP on public exchanges to retail investors didn’t constitute a security under federal laws.
However, the sale of XRP to institutional investors did, resulting in a fine of USD 125 million to Ripple. This ruling marks a turning point in cryptocurrency history and follows suit with many lawsuits against other crypto companies, such as Coinbase and Kraken, being dropped. This decision provides regulatory clarity for the digital asset industry. It will likely attract institutions that stay clear of the SEC to explore Ripple’s XRP-based payment solution and champion innovation.
Figure 3: Ripple CEO Brad Garlinghouse, Chief Legal Officer Stuart Alderoty and Donald Trump
Europe, Singapore, and Japan have embraced stances to similar to the US by setting clear guidelines for crypto innovation. Comparatively, China has imposed strict bans on crypto trading and mining activities. A disconnected patchwork approach to regulation makes global cryptocurrency adoption challenging because compliance requirements across borders can hinder innovation and limit the scalability of use.
Another risk to XRP is Stablecoins and Central Bank Digital Currencies (CBDCs). Stablecoins are cryptocurrencies whose value is pegged to another asset to maintain a stable price. They strive to provide an alternative to the high volatility of popular cryptocurrencies, making them potentially more suitable for transactions. CBDCs are digital versions of a country’s official currency controlled by the central bank. The rise of Stablecoins and CBDCs has the potential to divert attention and resources away from XRP, threatening mainstream adaptability due to an overlap in purpose.
The increasing involvement of institutions and central banks in blockchain technology is also about control. Blockchain is a way organisations can streamline operations, reduce fraud, and maintain oversight over transactions. However, while blockchain was designed to decentralise power, big institutions integrating it could end up reinforcing centralisation under a new guise. Ultimately, this raises the concern whether cryptocurrency is truly decentralised or centralised.
Ranking fourth in market capitalisation behind Bitcoin, Ethereum, and Tether, the proliferating interest in XRP has caused a shift in how transactions can occur. Although Bitcoin holds the largest market cap and is regarded as a store of value by most, its practical use for institutional purposes is limited. Firstly, the cost per token is drastically higher than that of XRP. For this reason, Bitcoin is mainly a store of value and is better for investment purposes. Bitcoin has a supply of 21 million tokens and must be actively mined. The downside to mining is that it requires electricity, precipitating high network fees and slow transactions.
XRP’s less volatile nature enhances its reliability for transactions. The total supply of XRP is capped at 100 billion tokens, which are pre-mined. Ripple placed 55 billion of these tokens into escrow accounts, gradually releasing them to maintain liquidity and prevent hyperinflation. Although in escrows, Ripple’s possession of a considerable portion of the supply of XRP arouses scepticism regarding XRP’s independence from Ripple. Additionally, it’s worth noting that Ripple’s past influence over validators have also escalated questions about XRP’s decentralisation.
After hovering just below $1 for most of 2024, Trump’s presidential triumph against Kamala was XRP’s breakout moment in the crypto bull market. XRP gained enormous momentum in November, rising above $3, breaking resistance levels and reaching multi-year highs.
Early in January, the CEO, Brad Garlinghouse and Ripple’s chief legal officer, Stuart Alderoty, had a private dinner with Donald Trump and donated $5 million in XRP to Donald Trump’s inaugural committee. Around this time, XRP achieved a new all-time high price of $5.35 days before Trump began his term. The coin was the biggest beneficiary postelection and is up more than 330%, stabilising at around $3.37. The announcement of the U.S. cryptocurrency reserve and Ripple’s success against the SEC caused a surge in XRP’s price.
The recent turbulence in the cryptocurrency market mirrors the stock market, which tariffs and uncertainty have driven. XRP’s price history reflects its ability to adapt and recover. Its ability to hold key support zones during bearish periods and surge past resistance levels during bullish runs suggests it thrives in favourable market conditions. Although future prices are uncertain, with the newfound support from the Trump administration, some predictions suggest that XRP could reach USD 5.50 in 2025.
Figure 6: XRP Price Predictions
As its role in the digital asset landscape evolves, XRP is in a more advantageous position due to Ripple’s close ties with the Trump administration. The nuances of digital assets have heightened confidence in the market and increased the likelihood of widespread adoption. Although not intended as an investment, XRP may be feasible if the price rallies, with institutional investors backing it and a large capital inflow. Time will tell whether institutions fully embrace XRP as the standard for global transactions.
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Figure 4: Bitcoin vs XRP
