Ripple’s XRP has experienced a dramatic decline, dropping from a peak of over $3.50 in July to around $1.40, despite the company’s recent legal victory and the launch of seven spot ETFs, including the Canary XRP ETF, which attracted over $1 billion in inflows. The core of XRP’s bullish narrative hinges on bank adoption of Ripple’s technology, but this thesis is flawed. Ripple’s most utilized product, RippleNet, does not create direct demand for XRP, while its On-Demand Liquidity (ODL) service, which does utilize XRP, is handling less transaction volume than anticipated.
Compounding the issue, Ripple’s introduction of a stablecoin, RLUSD, offers banks a less volatile alternative for cross-border transactions, further diminishing XRP’s appeal. As Ripple evolves into a larger payments infrastructure, the success of its products may not translate into higher XRP prices. Market professionals should consider the implications of Ripple’s product dynamics and the potential for XRP to remain below $1 in the coming years.
Source: fool.com