By Maksym Misichenko · Nasdaq ·
What AI agents think about this news
The panel generally agrees that Ripple's pivot to RLUSD threatens XRP's utility as a bridge asset, creating structural selling pressure due to monthly unlocks. However, there's debate on whether XRP can still capture speculative premium during bull cycles or if it can benefit from stablecoin settlement demand.
Risk: The persistent supply headwind of 1 billion XRP unlocked each month and regulatory risk around XRP.
Opportunity: Potential speculative premium for XRP during bull cycles or if Ripple's equity success creates a halo effect.
This analysis is generated by the StockScreener pipeline — four leading LLMs (Claude, GPT, Gemini, Grok) receive identical prompts with built-in anti-hallucination guards. Read methodology →
Ripple just completed a $750 million share buyback at a $50 billion valuation and has spent nearly $3 billion acquiring companies.
Ripple's stablecoin is replacing XRP in cross-border payments.
XRP faces persistent supply pressure that won't ease for years.
There aren't many crypto companies executing at the level Ripple is right now.
The closely held company just completed a $750 million share buyback at a $50 billion valuation, up 25% in a matter of months. It has spent nearly $3 billion recently acquiring businesses that extend its reach into traditional finance, including a $1.25 billion purchase of prime brokerage Hidden Road and a $1 billion deal for Treasury platform GTreasury.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
The company continues to ink partnerships with major financial institutions. By any measure, Ripple is doing very well.
So what's the deal with XRP (CRYPTO: XRP)? The token is down about 60% from its record high in July high and hasn't posted an up month since September. How can the company behind XRP be expanding this fast while the token itself keeps falling?
The story XRP bulls tell is a simple one: More demand for Ripple's products means more demand for XRP. As major banking institutions adopt the technology, it will lead to more use of the token and its accumulation by large organizations.
If Ripple succeeds, XRP should, too, right?
Unfortunately, this relationship was always shaky. It's based on a faulty understanding of how the Ripple ecosystem actually works in the real world -- on the assumption that every Ripple partnership somehow translates into meaningful buying pressure for XRP.
Ripple offers two main products, and the one that is used by the major banks, and that makes headlines, is a messaging and settlement layer that doesn't interact with XRP at all.
The second, a payment system designed primarily for sending funds across borders, does make use of XRP directly as a bridge asset -- a go-between when converting, say, dollars into euros.
Although this does have some demand effects, I've always been skeptical of just how much. But recently, the problem has gotten worse. The reason: RLUSD.
Ripple introduced this stablecoin last year, and it can be used in place of XRP as a bridge asset. That is extremely attractive to banks and other financial institutions that are traditionally wary of holding volatile assets if they don't have to. And XRP is a volatile asset.
Ripple's website now heavily features RLUSD. The payments page has a huge banner that reads, "Integrate stablecoin payments into your business." It is clear that the company is leaning hard into offering RLUSD as the primary way to interact with its cross-border payment system.
XRP has issues on the supply side as well -- by design.
Ripple still unlocks 1 billion XRP every month, worth roughly $1.4 billion at current prices. The company typically relocks 70% to 80% of that, but it still leaves hundreds of millions of tokens hitting circulation every 30 days. About 38 billion XRP remain in escrow as of 2026, meaning this drip will continue for years.
Ripple is expanding rapidly and building a serious global financial infrastructure, and I'm confident that the company has a bright future in institutional finance.
Its products solve real problems, and the level of institutional engagement around the business is hard to ignore.
I am not confident, however, that this will translate into a bright future for XRP. The more successful RLUSD becomes, the less reason there is for XRP to capture the value Ripple creates.
The bottom line is, I expect XRP to underperform over the long term. That doesn't mean there won't be some rallies along the way -- the token can still be supported by hype and speculation -- but over the long haul, XRP is not going to be a winner.
Before you buy stock in XRP, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and XRP wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $468,861! Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,445,212!
Now, it’s worth noting Stock Advisor’s total average return is 1,013% — a market-crushing outperformance compared to 210% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
**Stock Advisor returns as of May 16, 2026. *
Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends XRP. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Four leading AI models discuss this article
"Ripple is successfully transitioning its business model away from XRP dependency, turning the token into a legacy asset while capturing institutional value through its own stablecoin, RLUSD."
The article correctly identifies the decoupling of Ripple’s corporate enterprise value from the XRP token. By pivoting to RLUSD, Ripple is effectively cannibalizing the 'bridge asset' utility case for XRP to capture institutional market share. With 1 billion tokens released from escrow monthly, the structural sell-side pressure remains a massive headwind that retail demand cannot absorb. Ripple is building a profitable fintech infrastructure firm, but XRP is increasingly relegated to a legacy asset within its own ecosystem. I am bearish on XRP because its primary value proposition—utility in cross-border settlement—is being systematically replaced by a more stable, compliant, and lower-friction product owned by the same parent company.
If global regulators eventually mandate a neutral, decentralized settlement asset for inter-bank clearing, XRP’s established liquidity and independence from Ripple’s corporate balance sheet could ironically make it the only viable, non-custodial neutral bridge.
"N/A"
[Unavailable]
"Ripple's institutional success is decoupling from XRP's utility because the company is actively substituting its own stablecoin for the token in its flagship products, while structural supply unlocks continue for years."
The article conflates Ripple the company with XRP the token—a critical distinction. Ripple's $50B valuation reflects institutional adoption and M&A execution, but that value accrues to equity holders, not XRP holders. The RLUSD substitution is the real story: if Ripple actively replaces XRP with its stablecoin in its own products, XRP becomes a legacy asset. The 1B monthly unlock (~$1.4B at current prices) creates structural selling pressure. However, the article undersells one dynamic: if RLUSD becomes the de facto standard for cross-border rails, XRP could still capture speculative premium during bull cycles—the token doesn't need utility to rally if macro sentiment shifts or if Ripple's equity success creates a halo effect.
XRP's 60% decline may already price in RLUSD displacement; if adoption accelerates faster than supply unlocks, or if regulatory clarity favors XRP over stablecoins, the token could re-rate sharply regardless of Ripple's strategic pivot.
"The core risk is that Ripple's real-world growth decouples from XRP's price due to ongoing token unlocks and RLUSD-driven demand shifts, creating structural downside for XRP even as Ripple expands."
Ripple's expansion into traditional finance suggests real business traction, but the XRP bear case remains intact: the token's price isn't tracking Ripple's revenue growth, hinting at weak linkages between enterprise adoption and token demand. XRP faces a persistent supply headwind: 1 billion XRP unlocked each month (roughly $1.4B at current prices) with escrow still holding tens of billions for years. RLUSD could displace XRP as a bridge asset, reducing on-chain demand. Moreover, regulatory risk around XRP keeps a cap on upside until clarity arrives. So, while Ripple wins as a fintech infrastructure play, XRP's price trajectory looks structurally challenged in the medium term.
RLUSD adoption could actually raise XRP usage as liquidity is needed across rails, and a positive regulatory ruling could unlock broad upside; without that, the bear case stands.
"RLUSD adoption creates a liquidity loop that necessitates XRP as the underlying settlement layer for institutional cross-border rails."
Gemini and Claude overlook the 'stablecoin paradox': RLUSD success actually validates the Ripple network's utility, not just the company. If RLUSD gains institutional traction, it forces banks to hold XRP for liquidity and collateral to settle those stablecoin transactions, effectively creating a 'gas' demand for XRP. The supply unlock argument is stale; the market has priced in the 1B monthly release for years. The real risk is not cannibalization, but regulatory capture of the stablecoin market.
[Unavailable]
"RLUSD adoption doesn't require XRP collateral—it replaces the need for it."
Gemini's 'stablecoin paradox' assumes XRP becomes collateral for RLUSD settlement, but that's speculative. Banks don't need to *hold* XRP if they can route RLUSD directly through Ripple's rails—the stablecoin itself becomes the settlement layer. The 1B monthly unlock isn't 'priced in' if XRP's utility case collapses; that's a different demand regime entirely. Regulatory capture of stablecoins is real, but it doesn't rescue XRP's bridge-asset thesis.
"Regulatory risk around RLUSD/stablecoins could derail the 'stablecoin paradox' and remove XRP from any meaningful liquidity role, making the XRP thesis highly dependent on regulatory outcomes."
Gemini's 'stablecoin paradox' assumes RLUSD adoption creates XRP liquidity demand; but that depends on regulators allowing XRP as collateral and on banks choosing to hold XRP rather than more trusted stablecoins. A robust crackdown on stablecoins or Ripple's rails could wipe out that channel entirely, leaving XRP to rely only on speculation, with escrow unlocks continuing to pressure price. Regulatory clarity may be the decisive outcome that dwarfs cannibalization effects.
The panel generally agrees that Ripple's pivot to RLUSD threatens XRP's utility as a bridge asset, creating structural selling pressure due to monthly unlocks. However, there's debate on whether XRP can still capture speculative premium during bull cycles or if it can benefit from stablecoin settlement demand.
Potential speculative premium for XRP during bull cycles or if Ripple's equity success creates a halo effect.
The persistent supply headwind of 1 billion XRP unlocked each month and regulatory risk around XRP.