XRP (CRYPTO: XRP) trades around $1.10 today. That’s down close to 50% over the last six months despite billions of inflows into the relatively new spot XRP ETFs. So, what gives? And more importantly, is this a bottom, or is XRP heading lower?
I think there’s further to fall — a lot.
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That’s not because of anything Ripple, the company behind the token, is doing wrong — far from it. Ripple is executing about as well as any private crypto business out there. It has spent billions acquiring firms that push it deeper into traditional finance, and it keeps signing partnerships with major banks and financial institutions.
Here’s the real issue.
The bull case was always built on shaky ground
The bull case for XRP has always rested on one assumption: that Ripple’s growth in the banking industry pulls XRP up with it. More partnerships mean more payment volume. More payment volume means more demand for the token.
While it sounds nice, that link was never as strong as bulls claimed. Ripple sells two main products, and they don’t lean on XRP equally. The messaging and settlement layer that most big banks actually use never touches the token at all.
The cross-border payments system, on the other hand, does use XRP directly, as a bridge asset — the go-between when you’re converting, say, dollars into euros.
Ripple’s stablecoin is eating XRP’s lunch
The story is now even weaker. Ripple launched its own stablecoin, RLUSD, and it can serve as a bridge asset in place of XRP. In just a year, its market cap has grown to $1.53 billion.
For a bank moving money across borders, the dollar-pegged stablecoin is the obvious option. A bank is not eager to hold a volatile asset when it doesn’t have to, even for a few seconds.
Ripple isn’t hiding this, either. Go to its payments page, and you’ll see stablecoin integration is the headline pitch.
Why I think XRP is heading lower
While Ripple is building serious global financial infrastructure, and I think the company has a bright future in institutional finance, I’m not confident that most of that value flows to the token.
For my money, XRP is heading lower. While there could be some short-lived spikes, I think XRP will be trading 50% lower or more over time. There just isn’t enough demand pressure to support the price the way bulls expect. And that means the hype that’s driven XRP’s price to this point will continue to fade.
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