Could it also dethrone Bitcoin in the coming years?
This was the last time XRP overtook ETH.
With its impressive post-election recovery and ETH still struggling to gain traction, this will likely recur in the coming months.
This is a far cry from The Flippening—the hypothetical scenario of Ethereum overtaking Bitcoin as the #1 crypto asset—but this tussle for second place still garners considerable attention among crypto enthusiasts, especially since XRP’s impressive comeback after the latest US Elections.
Today, I will cover seven bullish catalysts for XRP versus ETH and debunk a common myth about Ripple. Let’s begin.
1) Pending spot XRP exchange-traded fund (ETF) applications
As Ether has already experienced hype in the lead-up to receiving its spot ETFs last year, excitement is building for XRP, Litecoin (LTC) and Solana (SOL) equivalents within the next 12 months.
The US Securities and Exchange Commission (SEC) accepted related filings from asset management companies such as 21 Shares, Bitwise, Canary Capital, CoinShares and WisdomTree just days ago, with the latter submitting its proposal two months ago.
This rapid flurry of spot ETF requests (and many more to come shortly) only adds to the speculation, boosting XRP’s reputation as a regulated asset with staying power.
Beyond the USA, Brazil’s securities regulator, the Comissão de Valores Mobiliários, has given the all-clear for an XRP spot ETF, making it the first one in the world to get approved.
2) New stablecoin on the XRP Ledger (XRPL)
In December, Ripple released its first stablecoin, RLUSD, looking to provide another option to the USDT-USDC dominance and other emerging alternatives.
As Ripple is closely aligned with dozens of financial institutions interested in its services worldwide, I expect many of these to readily adopt its stablecoin alongside XRP.
While it’s still very early, with a market cap that’s a tiny fraction of Tether’s USDT and a handful of crypto exchanges using it, it will take years to get anywhere close to its being a first or second choice across the sector.
However, this presents enormous opportunities for the XRPL and Ripple as we see continued growth in this asset class, benefitting stablecoin providers.
So, how does this benefit XRP? When someone sends RLUSD, XRP covers the transaction fee. 2 XRP are also required to establish a trust line when receiving the token or the stablecoin.
Moreover, many don’t realise that XRP also has a burn mechanism similar to (albeit less than) Ethereum’s coin burn, whereby a tiny portion of each transaction is burnt and removed from circulation.
While this has only led to a minuscule amount of XRP burnt to date—13.6 million tokens, representing 0.00014% of the total supply—, do remember that this rate will increase as XRP and RLUSD become widely used.
You shouldn’t rely on a burn mechanism to boost the price. Instead, focus on utility, partnerships, network security and stability, and a good UX for any network.
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RLUSD operates on XRPL and works on Ethereum via the XRPL EVM sidechain, using Axelar as a bridge.
Check out the Ripple USD whitepaper for more information. From what I’ve read about its possible use cases, I have high hopes for this digital asset in the coming years, particularly with its applications across Forex, real-world assets (RWAs), cross-border payments, on—and off-ramps, and facilitating settlements for banks and fund managers.
“New and existing customers can take advantage of the benefits a stablecoin on the XRPL provides, such as near real-time settlement, network effects, and low transaction costs.”
Ripple USD: The stablecoin for the Internet of Value (2024 Whitepaper, page 9)
Regarding the firm, there’s a big event coming up for it, which leads me to my next point.
3) The Ripple vs SEC lawsuit is close to ending
I believe this will be fully resolved in the coming months. This is because the soon-to-be SEC Chair Paul Atkins and his colleagues are adopting a crypto-friendly stance (let alone across the board in Trump’s second administration), unlike former Chair Gary Gensler and a few other SEC representatives with their persistent anti-crypto views.
In July 2023, Ripple received a breakthrough surrounding the legal classification of XRP in the USA.
Judge Analisa Torres concluded that XRP tokens sold on exchanges and algorithms (e.g., decentralised exchanges) did not violate federal securities laws. In contrast, sales to institutional investors were classified as securities.
When Atkins takes office (his position has yet to be appointed by the Senate, so Mark Uyeda is serving as the interim Chair), the expectation is that he’ll drop the case against Ripple, which began in December 2020.
4) An eventual Ripple IPO
This idea has been discussed for several years but has gained popularity over the past 12-18 months following the favourable XRP ruling, as mentioned above.
The intention is to IPO once the lawsuit has been officially dropped.
When considering the event’s impact on XRP’s short-term price, there are two things to remember:
– I am unsure how much of this IPO rhetoric has already been priced into XRP. I would say very little, especially if the token’s price is still lower than its ATH from seven years ago.
– If Ripple were to go public this year, it might not be a wise move for its prospective shareholders.
Why? I’m considering the price trends of another crypto/blockchain tech firm, Coinbase (COIN: NASDAQ), which went public in the latter half of the 2020-21 bull cycle.
It tanked once the bull market ended, going from its launch price of $380 in April 2021 and collapsing to $31 in December 2022, amid the worst part of the 2022-23 bear market.
Despite the strong crypto market performance since November, it is still down from its ATH.
However, the market has matured since then, and Ripple isn’t Coinbase. Let’s see how things pan out.
5) Less competition from established rivals
When was the last time you heard about an “XRP competitor?”
The only example that comes to mind is Stellar Lumens (XLM), a hard fork of XRP. But to call it a formidable “competitor” in 2025 is a stretch; no offence to the staunch XLM believers.
On the other hand, there’s plenty of discussion about numerous L1 alternatives to Ethereum, namely Solana, not to mention growing hype around Sui and Aptos.
While I doubt Ethereum will lose its spot as the leading smart contracts platform, let alone relinquish much market dominance, Solana and other L1s have taken energy away from Ethereum.
Don’t just take my word for it. The 2024 Developer Report from Electric Capital shows that Solana onboarded more developers than Ethereum each month since July, the first time this has happened since 2016.
Let’s not forget developer activity on Base (an L2, I know), Internet Computer, Bitcoin, Polygon, NEAR, Polkadot and others.
Yes, they’re still far behind Ethereum. Despite this, these projects are taking attention and market share away from the world’s leading smart contracts platform, which also benefits from its recognition and first-mover advantage.
6) A sharp jump in the number of new XRP wallets and DEX trading volume
One of the most promising signs of this XRP price rebound was the creation of 709,545 new wallets in Q4 2024, representing a 404% increase from the 140,657 established in Q3, according to Ripple’s Q4 2024 XRP Markets Report. This release also noted a 1,400% quarter-on-quarter boost in XRP DEX volume (measured in USD).
The company has published these updates since Q3 2017.
On the other hand, Ethereum experienced significantly less DEX growth (relative to XRPL) despite remaining the dominant chain in DeFi.
Moreover, data from OAK Research’s Ethereum (ETH): Market report for 2024 shows an overall decline in network activity, mostly due to a surge in trading volume for Solana, particularly in November and December.
On-chain active ETH addresses barely grew in 2024, starting at around 450,000 per week, peaking at 600,000 in late March and finishing at 500,000.
7) XRP closing on ETH once again
Nic Puckrin, the CEO of Coin Bureau, the largest crypto channel on YouTube and educational service, posted on X about XRP rapidly closing the gap on ETH.
This is the price of XRP vs. ETH.
Up 451% since November.
XRP is 50% of the way to flipping ETH in market cap.
Rough. pic.twitter.com/g4PlQmN7Sl
— Nic (@nicrypto) February 16, 2025
Yet, it remains an uphill battle. For it to overtake ETH once again, it would have to more than double its current circulating market cap (CMC). The MarketCapOf website says the key number is $5.60 per token.
However, when XRP pumps, ETH will likely appreciate simultaneously but to a lesser extent. As a result, it will probably need to more than triple its price and get past $8 per token to comfortably retake the second spot.
I admit that the token’s unit price is well behind ETH when comparing 2017/18 bull cycle peaks: XRP’s $3.65 vs ETH’s $1,400, translating to around ~$12.50 to match ETH’s ATH of $4,880.
I recommend using TradingView’s XRP/ETH chart to track its performance and to apply technical indicators (not paid advertising, FYI).
“Ripple controls most of the XRP supply.”
Before continuing, I want to clarify a common misconception about Ripple’s XRP holdings.
In December 2017, the company’s CTO, David Schwartz (who still holds this position), announced the creation of Ripple’s XRP Escrow account.
At the time, it locked up 55 billion tokens – representing 55% of the total supply – into a series of escrows. In a blog post, Schwartz mentioned:
“The escrow consists of independent on ledger escrows that release a total of one billion XRP each month over the next 55 months…The amount of XRP actually released into circulation will likely be much less than this. Any additional XRP leftover each month will be placed into a new escrow to release in the first month in which no escrow currently releases.”
A separate media release from December 2017 also identifies supply predictability as a reason for this setup.
The company’s XRP market reports, mentioned above, have provided updates about these token releases for years (search “escrow” in these documents, and you’ll see the stats).
While three billion XRP are made available quarterly, most (typically 2.3-2.7 billion) tokens are put into new escrows and sent to the back of the original queue.
The process will repeat until all have been sold, which, based on the controlled token emissions schedule, will take many years.
In Ripple’s latest report (January 31, 2025), the total ‘XRP subject to on-ledger escrow’ is 38,030,000,005, down from 38,900,000,005 the previous quarter.
Notice the above-average amount sold off in Q4 2024: 870,000. The extra demand makes sense, considering XRP’s massive price spike.
While Ripple still holds 4,485,366,320 tokens, which is reasonable, people must stop living in the past and saying Ripple “controls most XRP”. Some basic research goes a long way.
Additional thoughts
There’s an extra factor, albeit a superficial one: crypto vanity.
During the next bullish phase, new people (or some casual crypto investors) will enter or return to the market and look for relatively cheap yet established projects.
If you tell these individuals ETH and XRP still have good ROI potential, many of these noobs will opt to own 500 XRP than 0.46 ETH.
The latter’s lower market cap, not to mention posts and videos featuring ambitious price targets, will make this cohort more inclined to pick XRP and ETH.
While XRP will likely overtake ETH once again, it’s hard to tell who will secure and maintain its spot behind Bitcoin in the long term due to the highly dynamic nature of this asset class.
If (or I believe when) XRP returns to the second spot, will it ever overthrow BTC?
The way things are going, this is highly unlikely, especially with the flagship’s cryptocurrency’s impressive performance and strong resistance, managing to consistently remain above $90K following its new $108K ATH set last month.
It’s important to remember that Bitcoin, Ethereum and XRP have different purposes, thus, their strengths and weaknesses. In brief, the way I see it:
– Bitcoin‘s strengths are its robust decentralisation and security (albeit slow), with BTC regarded as “digital gold.”
– Ethereum is better adapted to hosting multiple dApps with its comprehensive smart contract functionality, even though its base layer is slow and still has expensive transactions.
– XRP is best suited for settling international payments quickly and cheaply, and Ripple benefits the network by utilising XRPL for its various fintech services. However, its chain is far less decentralised than Bitcoin and Ethereum‘s.
As a result, I see these projects as mostly complementary, at least in the short—to medium-term.
In summary, XRP has a solid reputation and longevity, even more than ETH. It is one of the oldest cryptocurrencies in the top 100 and is actively used.
While both will likely thrive in the coming years, XRP is more undervalued than ETH, especially given its gradual integration into bank and remittance systems via Ripple and its convenience for P2P (micro) transactions.
How much higher will these go for the rest of this bull cycle?
Disclaimers
- N.B. None of this is financial advice; I am not a financial advisor. This information is for educational purposes only. You are ultimately responsible for your investments.
- My opinions in this piece might not reflect those behind any news outlet, person, organisation, or otherwise listed here.
- Please do your own research before investing in any crypto assets, staking, NFTs or other products affiliated with this space.
• ETH accounts for approximately 25% of my portfolio, and XRP makes up another 10%.
Featured image credits
– Background by Visual Unit at Shutterstock, ID 2131809693
– ETH (glyph) logo courtesy of Ethereum brand assets
– The XRP logo was derived from the HFA_Illustrations image at Shutterstock, ID 1240448251.
Additional reading: https://everstake.one/crypto-reports/ethereum-2024-staking-insights-and-analysis