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XRP’s Recent Performance and Market Position
XRP, created by Ripple Labs, has seen a staggering surge in value, climbing over 350% since early November. It now ranks as the third-largest digital asset, with a market capitalisation of AUD 145.6 billion, surpassing major financial giants like Mastercard and Morgan Stanley. XRP’s price movements reflect growing confidence in its potential as a global payment solution.
Figure 1: XRP’s growth over a month (Credit: CoinSpot)
The Speculative Frenzy Behind XRP’s Surge
XRP’s rally has been driven largely by speculative enthusiasm. Many retail investors believe it could become the go-to cryptocurrency for international payments. Unlike Bitcoin, seen as digital gold, and Ethereum, powering decentralised finance (DeFi) apps, XRP positions itself as a utility token for seamless cross-border transactions.
Retail investors have flooded forums like r/XRP, where over 600,000 members celebrate milestones and encourage holding the token. The community shares memes and optimistic projections, fuelling further buying pressure.
Utility and Partnerships
Ripple Labs has worked extensively to promote XRP as a global payment standard. Its near-instant settlements and minimal transaction fees aim to disrupt traditional financial systems. The company has partnered with over 300 financial institutions, including American Express, Santander, and SBI Holdings.
Ripple’s On-Demand Liquidity (ODL) service uses XRP to enable real-time international payments with transparent fees lower than traditional systems like SWIFT. Over 40 markets worldwide now use ODL, with Bhutan’s central bank integrating it for remittances.
Legal Battles and Ripple’s Recent Wins
XRP’s price rally also ties to Ripple’s legal victories against the U.S. Securities and Exchange Commission (SEC). The SEC had accused Ripple of conducting an unregistered securities offering worth AUD 2 billion. The case revolved around Ripple’s control over XRP supply, with the SEC claiming it should be classified as a security.
In late 2024, Judge Analisa Torres ruled in Ripple’s favour, stating that XRP itself was not a security under federal law. Though the SEC appealed, the decision significantly boosted market confidence. Ripple’s leadership expressed optimism that the regulatory uncertainty would soon be resolved under the new administration, led by crypto-friendly Chair Paul Atkins.
Stablecoins and New Developments
Ripple has expanded its offerings with the launch of Ripple Liquid USD (RLUSD), a stablecoin backed by cash and U.S. Treasuries. RLUSD bridges the gap between traditional currencies and digital assets, supporting XRP’s ecosystem by providing liquidity.
Ripple’s President, Monica Long, stated that RLUSD enhances XRP’s utility by simplifying conversions between fiat and crypto, making transactions faster and more secure.
Institutional Interest Grows
XRP’s rise has not been limited to retail investors. Institutional demand has surged, with the launch of XRP exchange-traded funds (ETFs) in December. BlackRock, Fidelity, and Vanguard were among the first to offer XRP-backed products, attracting over AUD 7.5 billion in investments within weeks.
Crypto platforms like CME Group have also introduced XRP futures, while Crypto.com offers high-yield interest products tied to XRP. Eric Steinman, a crypto investment strategist, noted that institutional investors now see XRP as a promising high-reward asset.
Current Price Trends and Performance
XRP continues its upward trajectory, with a 343% increase over six months and a 379% gain year-on-year. Recent data shows a market cap of AUD 145.6 billion and a 24-hour trading volume of AUD 7.3 billion.
The Road Ahead for XRP
Despite its meteoric rise, XRP faces criticism. Some sceptics argue that its rapid price increase mirrors speculative bubbles from past cycles. However, with legal victories, increased institutional adoption, and expanding use cases through ODL and RLUSD, XRP seems positioned for sustained growth in the evolving crypto landscape.
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