Summary XRP's recent price surge was driven by retail investors and strong community narratives, despite limited real-world utility and adoption by banks or governments. Potential XRP ETF approvals and Ripple's new RLUSD stablecoin could boost XRP's adoption and market value, providing new investment opportunities. XRP's price action shows sustained strength, breaking out from a 4-year triangle pattern, indicating potential for significant gains in a bullish market. To maximize profits, it's crucial to recognize market tops and sell strategically, especially given XRP's history of rapid deflation after price spikes. Introduction Ripple Labs is a US-based technology company that develops the Ripple payment protocol and exchange network. About 13 years ago, it also created its own digital currency called ( XRP-USD ) to enable money transfers over the internet, making it one of the OG's in the crypto space. One of the main assets of XRP is its legion of fanatical devotees called the "XRPArmy" who are quick to defend the company and promote the token. Charles Hoskinson, founder of Cardano (USD-ADA) has recently acknowledged the power of the XRPArmy: In a surprising twist, Charles Hoskinson, the founder of Cardano, has extended a rare endorsement to XRP, highlighting its strong community and credible leadership. This praise is notable, given the history of tension between Hoskinson and the XRP community. In a recent post on X, Hoskinson emphasized that XRP’s community is “genuine” and actively engaged, supporting the project’s long-term vision. But this "dinosaur coin" is hugely polarizing - people either love it, think it is going to the moon, or absolutely hate it as an elaborate corporate swindle. In crypto, actual use cases are still thin, despite many claims about the potential utility of any given product. This is true even for Bitcoin ( BTC-USD ) which was originally envisioned as a peer to peer electronic cash system. However, network fees have increased so much that this is no longer practical. But very importantly, it's since been reinvented with a digital gold narrative that has convinced millions of buyers. The one exception for usefulness is stable coins, which are undoubtedly the killer app. We will return to this later. With actual utility difficult to show, powerful narratives develop around cryptocurrencies and communities emerge to promote them. My original thesis In my first article about Ripple, I presented the XRP token as "a classic opportunity to buy during the market headwinds from the SEC lawsuit and sell on news of a settlement or outright legal victory." But I also cautioned that "despite hyped claims about the coin's future use for central banking, my research shows no reason to hold XRP for the long term." In this later article, I compared the price action of the LBRY coin ( LBC-USD ), which was embroiled in a similar SEC lawsuit and ultimately had a positive outcome, to the expected XRP price after any news of settlement or outright victory. I postulated the XRP price action would exactly match the LBC chart trend -- a huge spike on news and then a decline as retail buyers sell off. This rationale turned out to be absolutely valid - at least for a time. The best time to have sold XRP was seemingly during the first week after the legal decision. If someone had purchased in the low $.40's and sold during the spike (above $.80) they could have doubled their money. But the massive pump I expected just never materialized, and the post announcement price action was personally disappointing. The price stayed range bound for over a year. I felt my thesis was validated. Until November 2024 and this happened. XRP rises again (coingecko.com) The XRP price went parabolic, did a 5x from $.50 territory and hit a multi-year high of $2.71! Why I was wrong So what happened? Did Ripple's ODL (On Demand Liquidity) -- which uses XRP -- finally overtake the dominant SWIFT network's (Society for Worldwide Interbank Financial Telecommunication, providing the main messaging network for international payments) market share? It's true that ODL is now available in close to 40 markets. Although Ripple does not publish regular I last estimated ODL transactions at $9B for 2022. But no, there was nothing relevant with ODL to spark the rally. RippleNet's volume is still infinitesimal compared to SWIFT's huge trillion dollar a day market share and has zero measurable effect on the token price. Has XRP been designated the world's reserve currency? This story says the global financial system must have a scalable digital asset to address the massive national debt currently plaguing most countries, and XRP has been designated as the one by mysterious powers-that-be. The community meme symbolizing this is "XRP - ALL THE MONEY." But no, this theory is entirely speculative with a dearth of real supporting evidence, but it's a great example of what passes for fact by online influencers. I've been researching XRP's long-term prospect for five years now and still see almost no evidence of the massive banking or government adoption needed to drive the value of the coin. But you know what? It doesn't matter. I was wrong about XRP because this recent action was fueled by retail investors who were probably attracted by the massive end of year Bitcoin rally and subsequently captured by the narratives propagated by the XRP Army. It doesn't matter that research showed that ODL is going nowhere and there is no evidence for XRP as ALL THE MONEY. Why? Because vanishing few retail investors will ever put in the time to independently research these grandiose claims. When presented with slick Ripple marketing and a super strong community totally convinced XRP is going to the moon, that becomes their reality. These narratives are powerful, and I failed to account for that. New Drivers for XRP Apart from these questionable stories, there are some absolutely valid narratives that have emerged, underscoring the case for XRP. As with BTC and ETH, XRP may see an ETF (Exchange Trade Fund) - from this article we learn: As of Nov. 22, no direct XRP ETF was available in the U.S. market, but investors had indirect exposure to the digital asset through a closed-end fund , the Grayscale XRP Trust ( XRX ). Bitwise, Canary Capital, and 21Shares have filed with the SEC to gain approval to create a spot XRP ETF, which would be structured similarly to the existing spot bitcoin ETFs and ethereum ETFs . Some observers of crypto investments have speculated that Grayscale might convert its fund into an ETF. In December WisdomTree became the fourth firm to file for a spot XRP. Ripple's legal victories against the SEC now provide regulatory clarity which could boost investor confidence and lead to increased adoption via an ETF by financial institutions. Since its first ETF was launched in January 2024, the price of Bitcoin has increased over 120%. Some analysts are predicting the same for Ripple: JPMorgan, a leading global financial institution, has estimated that a spot-based XRP ETF may see flows of $3 billion and $8 billion. The financial giant based this approximation on the performance of Bitcoin and Ethereum ETFs that started in the market last year. Nate Geraci, a well-known expert in the ETF market, also noted that an XRP spot ETF could be approved within the year. This would be a great boost to Ripple and would also provide a lot of credence to the XRP token as a key digital currency in the market. Ripple's stablecoin RLUSD Ripple launched its own stablecoin, RLUSD. As noted here : ...Ripple’s new RLUSD stablecoin will be available on more exchanges “imminently” and expects it to become a major part of the firm’s payments and money businesses. RLUSD was rolled out to the broader public on Ethereum and XRP Ledger in December and has a $72 million market capitalization as of Wednesday. It adopted some of Chainlink's services on Tuesday to boost utility across decentralized finance ((DEFI)) protocols, as reported. Stablecoins are the killer app in the crypto space. In 2024 Market leader Tether reported "delivering a record net profit of $5.2 billion for the first half of the year." Their business model is simple: users exchange cash for USDT, Tether invests that in 3-month US Treasury notes paying north of 4%, and pockets the profit. They also coincidentally endear themselves to the US government as they rank 3rd in the entire world for the purchases of 3-month US Treasuries. Ripple wisely launched their stablecoin to get a share of this cash cow, expand the use cases for XRP, and potentially attract more institutional money into the ecosystem. My new thesis XRP has shown great strength since its breakout in November. There's been no major pullback at a time we've seen many other alt and meme coins just get crushed after a price spike. This price action is real and sustained. When you pull back and view the chart from a long term perspective, XRP has finally broken out from a 4-year triangle pattern. XRP 4 year triangle breakout (tradingview.com) Who knows where this could go from here, but given a sustained bull market into 2025, the upside could be massive. Many analysts estimate a Bitcoin peak this year of between $120,000 and $150,000, a potential 50% rise. With all the momentum building for XRP, I believe it could easily provide another price doubling, and possibly much more. Conclusion One online crypto influencer encourages us to respect the "Power of the Pump" -- meaning to see things for what they are without the negative stories we may have about a coin. I still don't care for Ripple, the company. I still don't believe the narratives that XRP will be the world currency or supplant SWIFT for money transfers. But there is chart strength, upcoming positive events, and an over-enthusiastic community behind XRP. To make money, that should be respected. The key for all profits is to know when to sell. This is the most important thing about holding XRP. As I've shown in previous articles, after a final price spike XRP has a history of rapidly deflating. I believe the entire crypto market is headed for a spectacular blow off peak in 2025. The savvy investor must recognize that and move quickly to maximize profits. If there is interest in the markers and indications of a market top, I'll produce an article about it. As I always reiterate, think for yourself and only invest what you can afford to lose. Especially in the wild world of crypto, there are no guarantees. We may not see "XRP All The Money," but investors could position themselves to profit with this coin in 2025.
