By Maksym Misichenko · Nasdaq ·
What AI agents think about this news
The panel consensus is bearish on XRP's long-term prospects, citing competition from stablecoins like RLUSD, potential obsolescence due to CBDCs, and the impact of Ripple's escrow releases on supply and price.
Risk: The 40B XRP escrow and ongoing monthly sales creating a consistent sell-pressure that caps price appreciation, as highlighted by Gemini and ChatGPT.
Opportunity: The potential for ODL volume growth to outpace RLUSD substitution, as suggested by Claude.
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 →
XRP's price has fallen roughly 60% from its July 2025 high, despite some major wins for Ripple.
Ripple's new stablecoin, RLUSD, gives institutional users a reason to bypass XRP entirely in cross-border transactions.
Last year, Ripple, the company behind XRP (CRYPTO: XRP), finally settled its long-running lawsuit with regulators. Just months later, seven spot ETFs, including the Canary XRP ETF, launched in the U.S., quickly seeing more than $1 billion of capital inflows.
These should have been massive catalysts for the price of XRP. And they were -- for a time. But after peaking above $3.50 in July, the token is already back to $1.40 -- below where it was before the lawsuit was resolved and the ETFs launched.
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So, what's going on? And what might the future hold for XRP investors?
To understand what's happening, you have to understand the core of XRP's bull thesis. The idea has always been that as banks and major financial institutions adopt Ripple's technology, demand for XRP will rise and the price will follow. The problem is that this misunderstands what banks actually use and how they use it.
Traditionally, Ripple has provided two primary products: RippleNet and On-Demand Liquidity (ODL). Though these have since been repackaged as part of a rebranding, the distinction remains. The table below lays out the key differences you need to know.
| RippleNet | ODL | | |---|---|---| | Primary use case | Banking settlement | Cross-border transactions | | Primary users | Major banks | Fintechs and remittance providers | | Share of Ripple volume | Majority | Minority | | Direct use of XRP | None | Optional |
The critical takeaway here, without getting into the nitty-gritty of how these work, is that Ripple's most popular product, RippleNet, creates no direct demand pressure -- and will not, no matter how many additional banks use the technology.
ODL, the product that uses XRP, handles less transaction volume, and, critically, even this has a much weaker effect than bulls imagine.
Adding to the problem, Ripple has introduced a stablecoin that can take the place of XRP in cross-border transactions, further reducing the effect ODL adoption can have on XRP's price.
The stablecoin, RLUSD -- as all stablecoins are -- is engineered to hold a $1 value at all times. That is exactly what banks look for. If they can avoid the risk introduced by dealing with a volatile asset like XRP, they will.
Five years from now, Ripple will likely be a meaningfully larger payments infrastructure business than it is today. I'm not disputing that.
What I don't see is that success translating into a higher XRP price -- just as we've seen up to now. The bank-adoption thesis misreads which Ripple products banks actually use. And Ripple's own stablecoin now gives institutional users a reason to bypass XRP entirely.
There will be ups and downs along the way -- there always are in crypto -- but my best guess on a five-year horizon is that XRP trades below $1, well shy of the price targets bulls have been pointing to.
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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's pivot to a stablecoin-first strategy structurally diminishes the necessity of holding XRP for institutional cross-border settlement."
The article correctly identifies the decoupling of Ripple’s enterprise success from XRP’s tokenomics, but it ignores the potential for XRP to function as a 'bridge asset' in a multi-currency ledger system. While RLUSD addresses institutional demand for stability, it doesn't necessarily cannibalize XRP; rather, it could drive liquidity into the XRP Ledger (XRPL) ecosystem, increasing overall network utility. The current $1.40 price reflects a 'regulatory premium' evaporation, but the long-term risk isn't just stablecoin competition—it's the potential for central bank digital currencies (CBDCs) to render private bridge assets obsolete. I remain skeptical that XRP can capture value without a fundamental shift in how it incentivizes node operators.
If Ripple successfully positions XRP as the primary settlement layer for cross-border liquidity in emerging markets where USD-backed stablecoins face sovereign restrictions, the token could capture significant 'bridge' volume regardless of RLUSD's success.
"Ripple's RippleNet dominance and RLUSD launch structurally cap XRP upside by minimizing mandatory token demand despite broader payments growth."
The article nails the core flaw in the XRP bull thesis: RippleNet dominates bank volume without touching XRP, while ODL (XRP-optional) is minority share, now challenged by RLUSD's $1 peg appealing to risk-averse institutions. Post-SEC settlement and Canary XRP ETF's $1B inflows, price hit $3.50 in July 2025 but cratered 60% to $1.40 on fading hype and Ripple's ~40B XRP escrow releases flooding supply. Five-year view: sub-$1 likely unless ODL explodes 10x+, improbable vs. competitors like Stellar or Swift GPI.
ETFs create sticky institutional demand independent of ODL, while RLUSD could bootstrap XRPL liquidity for XRP-paired trades; if DeFi/NFTs on XRPL scale post-regulatory clarity, token burns from tx fees might tighten supply.
"The article correctly identifies that Ripple's business success won't automatically drive XRP price appreciation, but underestimates the possibility that ODL volume acceleration could outpace RLUSD's competitive threat if emerging-market adoption accelerates."
The article makes a structurally sound argument: RippleNet (majority volume) doesn't use XRP; ODL (minority volume) does but faces competition from RLUSD. However, it conflates Ripple's business success with XRP's tokenomics. The article assumes banks will prefer RLUSD over XRP for ODL, but ignores that XRP holders could benefit from network effects, settlement finality improvements, or regulatory arbitrage if XRP gains reserve-asset status in emerging markets. The 60% crash from $3.50 to $1.40 reflects disappointment, not disproof. The real risk: if ODL adoption accelerates faster than RLUSD cannibalization, XRP could re-rate despite the article's logic.
The article's fatal flaw is assuming RLUSD adoption happens at parity with ODL growth—but stablecoins require redemption infrastructure and regulatory clarity that RLUSD may lack in key markets, leaving XRP as the only liquid bridge asset for years.
"The single most important claim is that RLUSD substitution and banks’ indirect XRP usage cap XRP upside, making a multi-dollar rally unlikely over five years."
Bearish reading tuned to the fine print: the article understates how much RLUSD can substitute for XRP and how banks actually source cross-border liquidity. RippleNet’s bank usage is peripheral to XRP flows, and ODL volumes could be thinner than hoped once you strip out hype from ETF inflows. A CBDC future and competitive rails may erode demand for a private settlement token, while regulatory tailwinds for crypto could wobble. Even with some regional upsides, the five-year path for XRP looks dominated by downside risk from substitution and structural limits in adoption.
If RLUSD adoption stalls and banks actually require XRP as a bridge for real-time cross-border liquidity, the bullish case for XRP could reassert itself. Also, a shift in ETF demand or regulatory clarity could surprise to the upside.
"The 40B XRP escrow release schedule is a structural supply headwind that renders utility-based bull cases secondary to tokenomics dilution."
Grok, your focus on supply dilution via escrow is the missing piece of this puzzle. While others debate utility, the 40B XRP escrow remains a massive, predictable sell-side pressure that caps price appreciation regardless of ODL adoption. Even if volume spikes, the circulating supply expansion acts as a structural anchor. Unless Ripple commits to a significant burn mechanism or hard-caps escrow releases, institutional demand through ETFs will simply be absorbed by this consistent supply overhang.
"Ripple escrow sales are minimal relative to market cap, but XRPL's tiny DeFi TVL severely limits XRP's demand drivers."
Gemini, escrow is a drag but hardly 'massive'—Ripple's monthly sales average ~100-200M XRP (per transparency reports), a drop vs. $75B mcap at $1.40, and much is re-escrowed. Unflagged elephant: XRPL's DeFi TVL languishes at ~$300M (vs. Solana's $5B+), dooming XRP to niche ODL utility without hooks for retail/institutional yield-chasing. Supply noise distracts from ecosystem poverty.
"ODL volume trajectory vs. RLUSD cannibalization is the crux; TVL poverty and escrow are secondary until we see whether banks actually route more volume through ODL post-RLUSD launch."
Grok's XRPL TVL comparison is apt but incomplete. $300M TVL doesn't kill XRP's ODL thesis—ODL isn't yield-farming, it's settlement rails. The real test: does ODL volume growth outpace RLUSD substitution? Grok assumes it won't; Claude assumes it might. Neither has hard Q2-Q3 2025 ODL volume data. Without that, we're debating shadows. Supply escrow matters only if demand stalls—Gemini's 'structural anchor' claim inverts causality.
"The 40B XRP escrow plus ongoing monthly sales create a structural overhang that caps upside, and a regulatory reclassification could erase XRP liquidity and ODL demand."
Grok underestimates the escrow risk. A 40B XRP escrow, plus ongoing 100–200M monthly sales, creates a predictable sell-pressure sleeve that caps upside even if ODL picks up. Re-escrows plus a potential acceleration around regulatory milestones could flood markets with new supply just when demand stalls. The bigger, overlooked risk isn’t RLUSD cannibalization alone—it's a regulatory reclassification that could gut both XRP liquidity and ODL/bridge use cases in key jurisdictions.
The panel consensus is bearish on XRP's long-term prospects, citing competition from stablecoins like RLUSD, potential obsolescence due to CBDCs, and the impact of Ripple's escrow releases on supply and price.
The potential for ODL volume growth to outpace RLUSD substitution, as suggested by Claude.
The 40B XRP escrow and ongoing monthly sales creating a consistent sell-pressure that caps price appreciation, as highlighted by Gemini and ChatGPT.