Author: Daniel Li, CoinVoice
Recently, the cryptocurrency market has seen multiple positive developments, with the long-standing public chain Ripple (XRP) becoming the focus of market attention. The news of the upcoming departure of Gary Gensler, the chairman of the U.S. Securities and Exchange Commission (SEC), has ignited market expectations for a more friendly regulatory environment. At the same time, the long-standing legal dispute between Ripple and the SEC is also expected to be resolved, with multiple court rulings sending positive signals for Ripple, clearing some obstacles for the development of XRP.
This series of positive news has helped propel a strong rebound in the price of XRP, with a surge of over 250% in just one month, and a single-day gain of over 35%, reaching a new high in nearly three years, reigniting investor enthusiasm.
As one of the pioneers in the blockchain field, XRP has been focused on the cross-border payment scenario since its launch in 2012, and has been favored by financial institutions for its efficiency, low cost, and technological innovation. However, the growth path of this classic token has not been smooth, facing both the pressure of market competition and the setbacks caused by regulatory controversies. Now, against the backdrop of a gradually improving regulatory environment and restored market confidence, XRP seems to be seizing this historic opportunity to redefine its future market positioning. As a "veteran" in the cryptocurrency field, can XRP once again open up an innovative track and lead the future of blockchain-based payments? Let's take a closer look.
01. Regulatory Tailwinds: XRP, the "Revenge Concept Coin", Reaches a New 3-Year High
In the 2024 U.S. presidential election, Republican candidate Donald Trump was elected with a high vote. During the campaign, Trump had promised to turn the U.S. into the "global capital of cryptocurrencies" and strongly supported the cryptocurrency industry, which undoubtedly boosted market confidence and drove the prices of multiple cryptocurrencies, including XRP, to rise. In this wave of market recovery, XRP, dubbed the "revenge concept coin", has reached a new high in three years, becoming the focus of investor attention. However, the rise of XRP is not solely due to Trump's campaign promises, but also a series of changes in the regulatory environment and key developments in Ripple's four-year arduous litigation with the U.S. Securities and Exchange Commission (SEC).
Regulatory Changes Bring Catalysts to the Market
Since late 2020, Ripple has been sued by the SEC for allegedly raising funds through unregistered securities, and XRP has faced regulatory pressure for four years. The SEC accused Ripple of issuing XRP since 2013 and raising $1.3 billion, alleging that its actions violated securities laws. This litigation not only caused a significant drop in the price of XRP, but also forced several exchanges to temporarily suspend XRP trading, severely damaging market confidence.
However, as the legal dispute approaches its conclusion in 2023 and 2024, XRP has seen a long-awaited turnaround. In 2023 and 2024, rulings by New York Federal Judge Analisa Torres brought important breakthroughs for Ripple. She ruled that Ripple's sale of XRP to retail investors did not violate securities laws, while the sales to institutional investors were deemed illegal, and Ripple was required to pay a $125 million fine, significantly lower than the SEC's initial demand of $2 billion. This ruling not only provided Ripple with operational space for the future, but also sent a signal to the market about the future development of XRP, easing excessive concerns about regulation.
The New SEC Chair May Bring More Positive News for XRP
Another important factor driving the recovery of XRP is the news of the departure of SEC Chairman Gary Gensler. Gensler has been one of the most controversial regulators in the cryptocurrency industry in recent years, and his strict regulatory policies have plunged many cryptocurrency projects into difficulties. However, with Gensler set to step down in January 2025, market expectations for the new SEC leadership have increased significantly. Many expect that the new SEC leadership team may adopt a more relaxed and friendly attitude towards the cryptocurrency industry, bringing hope for XRP and other projects that have been suppressed by regulation.
The Washington Post reported that Trump's advisory team is evaluating multiple SEC chair candidates, some of whom have publicly supported cryptocurrencies. The market generally believes that these candidates may take a more friendly stance on cryptocurrency regulatory policies. If the new SEC chair does indeed drive a policy shift as expected, Ripple's lawsuit may be settled or even dismissed, and the regulatory environment for the entire cryptocurrency industry may undergo a fundamental change. For projects that have been suppressed, such as Ripple, Binance, Coinbase, and others, this would undoubtedly be a major policy tailwind.
Ripple Uses Political Action to Change the Litigation Predicament
Ripple's "revenge path" not only relies on changes in the legal and regulatory environment, but the company's active involvement in the political arena has also become part of its tactical strategy. According to CoinDesk, Ripple Labs has injected $25 million into the Fairshake political action committee (PAC) of the cryptocurrency industry, aiming to influence the 2026 U.S. congressional elections and promote a more friendly cryptocurrency regulatory policy. Ripple's move signals that the company is using political means to try to overturn its litigation predicament with the SEC and secure a more favorable legal and regulatory environment for XRP.
Furthermore, a Reuters report shows that multiple cryptocurrency companies, including Ripple, Circle, Kraken, Coinbase, a16z, and Paradigm, are vying for seats on the cryptocurrency advisory committee that Trump plans to establish. This committee will become an important platform for cryptocurrency policy reform, and the participating companies will have the opportunity to directly influence the future policy direction, especially under the crypto-friendly policy framework pushed by the Trump administration. If Ripple can secure a seat in this process, it will be able to advocate for more support for XRP at the policy level, gaining more freedom in the future regulatory environment.
02. XRP: The Innovator of the Traditional Financial Payment System
Over the past decades, the global financial payment system has been dominated by traditional bank settlement and payment methods. Although these systems have certain advantages in stability and security, with the deepening of globalization and the rapid development of e-commerce, the traditional financial payment system has exposed a series of pain points that urgently need to be solved. High transaction fees, low payment processing speed, and the complexity and high cost of cross-border payments have become bottlenecks hindering global financial liquidity and market development. To solve these problems, Ripple has launched XRP (Ripple) and the XRP Ledger, and with its innovative technical architecture and unique business model, it has quickly emerged as an important force in driving the transformation of the traditional financial payment system.
What is XRP and Ripple?
XRP is the native cryptocurrency of the Ripple network, and is one of the core technologies designed by Ripple to solve the pain points of the global payment system. Unlike traditional payment methods such as bank transfers and SWIFT, XRP provides a completely new solution for global payments through blockchain technology. Through its innovative Ripple Protocol Consensus Algorithm (RPCA) and the decentralized XRP Ledger, Ripple has greatly improved the speed of transactions, reduced costs, and provided the ability to cross borders and connect different currencies. XRP essentially serves as a bridge currency, enabling efficient and low-cost exchange between different fiat currencies, providing a smoother path for global payments and cross-border settlements.
Ripple, as a technology company dedicated to driving financial system innovation, was founded in 2012 by Chris Larsen and Jed McCaleb. Ripple's original goal was to use blockchain technology to transform the existing financial payment system, especially to solve the problems of high costs and low efficiency in the traditional banking settlement system. Ripple's vision is not only to create a new cryptocurrency, but more importantly, to build a decentralized, globalized financial network, connecting banks, payment service providers, and financial institutions around the world through RippleNet, to achieve faster, cheaper, and more efficient payments and transactions.
Technical Advantages of XRP: Efficiency, Low Cost, and High Throughput
One of the biggest advantages of XRP is the XRP Ledger (XRPL) technology architecture it uses. Unlike traditional Blockchain projects like Bitcoin and Ethereum, XRP employs a unique consensus mechanism called the Ripple Protocol Consensus Algorithm (RPCA). This algorithm does not rely on the traditional Proof-of-Work (PoW) or Proof-of-Stake (PoS) mechanisms, but instead achieves consensus through a set of independent validator nodes. This design allows the XRP network to complete transaction validation in just a few seconds, with transaction fees typically as low as 0.00001 XRP, significantly reducing the high transaction fees and time delays commonly found in traditional financial payments.
Compared to Bitcoin's transaction processing speed of only 7 transactions per second, the XRP Ledger can process up to 1,500 transactions per second, and its throughput is expected to further increase with ongoing technological optimization. This highly efficient transaction processing capability makes XRP an ideal choice for cross-border payments and fund transfers, particularly in scenarios requiring fast settlement and large-volume payments, where XRP demonstrates unparalleled advantages.
The Role of XRP in the Global Payment System: Revolutionizing Cross-Border Payments
One of the core advantages of XRP is its ability to provide efficient, low-cost payment solutions between different countries and regions, especially in the field of cross-border payments. Traditional cross-border payments often rely on multiple intermediary banks and complex settlement processes, which not only increase the time cost of transactions but also result in high fees. According to data from the Society for Worldwide Interbank Financial Telecommunication (SWIFT), traditional cross-border payments typically take 2 to 3 business days to complete, and the transaction fees are usually 5% to 10% of the payment amount. This inefficient and high-cost payment method has become a bottleneck in global financial transactions and business activities.
However, XRP has revolutionized this situation through its innovative On-Demand Liquidity (ODL) technology. The ODL technology allows users to make instant cross-border payments using XRP as a bridge currency, without the need for pre-funding. For example, when a company wants to transfer funds from the United States to Japan, the traditional method requires relying on multiple intermediary banks and may take several days to complete the transaction. With XRP, the user can complete the payment in just a few seconds, and the fees are much lower than traditional payment methods. This efficient, convenient, and low-cost payment solution has greatly improved the efficiency of global trade and capital flows.
Ripple has established a wide payment network globally through collaborations with numerous banks, payment service providers, and financial institutions. This allows XRP to play a crucial role not only in the traditional financial sector but also to achieve breakthroughs in the payment and remittance sectors of emerging markets and developing countries, further promoting the development of financial inclusion.
The Advantages of Ripple and XRP: Combining Bank Cooperation and Decentralization
XRP's success in the global payment system is inseparable from its deep cooperation with traditional banks and financial institutions. Ripple has always adhered to the principle of "cooperating with traditional financial institutions rather than confronting them," and by establishing strategic partnerships with leading global financial institutions, XRP has been able to achieve rapid promotion within the existing financial infrastructure. For example, Ripple has formed strategic collaborations with major banks and payment platforms such as Bank of America, Credit Suisse, and Mitsubishi UFJ Financial Group, which has helped to promote the application of XRP in cross-border payments and settlement. These partnerships not only enhance the market awareness of XRP but also lay a solid foundation for further expansion of its financial services.
However, the integration of XRP with the traditional banking system does not mean that it has lost its decentralized characteristics. The XRP Ledger is a decentralized public Blockchain, and anyone can join and become a validator node. This means that even if Ripple no longer exists, the XRP network can continue to operate. The decentralized design ensures that XRP is not controlled by a single institution, which is a key advantage that sets it apart from the traditional financial system.
In the future, XRP may not be limited to the cross-border payment sector, as its potential applications in emerging fields such as decentralized finance (DeFi) and asset tokenization are also worth looking forward to. As Ripple continues to strengthen its cooperation with global banks and financial institutions and promote the implementation of XRP in more financial sectors, XRP is expected to become an indispensable part of the global payment system and a new global currency.
03. From Traditional Finance to the Web3 Industry: Ripple's Long-Term Strategy and the Future of XRP
Although Ripple is a Blockchain company, its main focus has been on the traditional finance sector. As global financial technology develops rapidly, the transition from traditional finance to the Web3 industry has become a mainstream trend in the financial market, and Ripple has also begun to gradually expand into the Web3 industry. However, unlike many cryptocurrency projects, Ripple has not limited its sights to the digital currency sector alone, but is pushing for the diversification of its products and services from a broader perspective. Ripple is focusing on areas such as decentralized finance (DeFi), stablecoins, and asset tokenization in the Web3 space. It is worth noting that although XRP itself does not have a direct role in Ripple's strategic directions, Ripple's long-term layout has endowed XRP with broader application prospects.
Ripple's Prudent Strategy: Compliance as the Foundation, Expanding Web3 Cooperation
Unlike many cryptocurrency projects that are eager for quick success and speculative, Ripple has always adhered to a prudent core strategy, committed to driving innovation within the compliance framework. During the four-year litigation process with the U.S. Securities and Exchange Commission (SEC), Ripple's strategic direction has become increasingly clear, further strengthening its concept of stable development. From initially positioning XRP as a cross-border payment tool to its current active layout in the Web3 space, Ripple has always maintained compliance and worked closely with traditional financial institutions. This strategy not only enhances market trust in Ripple but also makes its layout in the Web3 field more forward-looking and sustainable.
In terms of compliance, Ripple has achieved remarkable results. The company and its subsidiaries hold nearly 40 U.S. money transmission licenses, the New York BitLicense, the Monetary Authority of Singapore's major payment institution license, and the Central Bank of Ireland's Virtual Asset Service Provider (VASP) registration, ensuring its legal operation in multiple countries and regions. These qualifications provide Ripple with strong compliance assurance and further enhance its credibility as a global financial service provider.
Ripple's global network of partnerships also provides strong support for its expansion into the Web3 field. The company has established deep cooperation with more than 100 banks and financial institutions worldwide, including well-known institutions such as Santander Bank and Mitsubishi Bank. These partnerships not only enhance Ripple's influence in the traditional finance sector but also provide more practical application scenarios for the use of XRP. In addition, Ripple is collaborating with platforms like Archax to actively promote the tokenization of real-world assets (RWA), helping traditional financial assets smoothly enter the Blockchain ecosystem. Meanwhile, Ripple is also making forays into the "institutional-grade DeFi" field, partnering with platforms like OpenEden to invest in projects such as the tokenization of government bonds, creating new opportunities for further cooperation with financial institutions. Recently, the XRP ETF proposals submitted by companies like Bitwise Asset Management have also sparked widespread market attention to Ripple's future potential, further validating its strategic advantages in the integration of Web3 and traditional finance.
XRP and Web3: Challenges and Opportunities in Transformation
While Ripple has gradually shifted its strategic focus from traditional cross-border payments to the Web3 field, this does not mean that the XRP token can adapt to this transformation without any obstacles. Unlike the traditional cross-border payment market, the core value of the Web3 industry lies in decentralization, digital asset liquidity, and smart contract applications, which make the role of XRP in Web3 fundamentally different from its role as a bridge currency in cross-border payments. Although XRP's technical advantages and efficient transaction mechanisms are still worth affirming, the biggest challenge it faces in the Web3 ecosystem is how to closely align with the needs of emerging fields such as DeFi (Decentralized Finance). In order to find a new position in this emerging field, Ripple must further promote the deep integration of XRP and Web3.
Ripple is expanding the application scenarios of XRP and gradually penetrating into other key technology fields of the Web3 industry through multiple initiatives. According to BlockBeats, on November 30, FOX Business reported, citing informed sources, that the New York Department of Financial Services has indicated to Ripple that it will approve the launch of its new stablecoin product - RLUSD, and plans to officially launch it on December 4. In the future, the RLUSD stablecoin will serve as a complementary tool for XRP, enhancing its role in Ripple's payment solutions. This strategy not only helps consolidate XRP's market position in the payment field, but also opens up new opportunities for its application in Web3. At the same time, Ripple is also actively promoting the construction of the XRPL ecosystem by funding developers and supporting innovative applications in the global Web3 field. Through these initiatives, Ripple is actively promoting the development of Web3 technology based on XRP, and providing innovative solutions for emerging fields such as DeFi (Decentralized Finance).
What is the future prospect of XRP?
After Trump's election, the crypto industry has taken an optimistic view of future regulatory policies, which has brought new opportunities for the traditional financial industry that has long aspired to enter the crypto market. As a company that has been deeply involved in the traditional financial field for a long time, Ripple has attracted the attention of a large number of investors due to its potential and influence in the cross-border payment field. The recent price trend of XRP also reflects this trend, with XRP recently breaking through a 5-year dynamic resistance level. Some optimistic crypto analysts believe that the next target price for XRP may reach $4.2, and with the support of market sentiment and policy tailwinds, XRP is expected to break through the historical high of $3.317 set in 2018 in the short term.
However, the future prospects of XRP are still subject to considerable controversy. On the one hand, the new chairman of the U.S. Securities and Exchange Commission (SEC) has not yet been determined, which creates a certain regulatory uncertainty for Ripple and still poses potential compliance risks. On the other hand, XRP's performance has not been as outstanding as expected since its launch in 2012. Although Ripple has announced plans to use XRP for cross-border payments, there is little evidence that the actual usage frequency of XRP in global financial services has reached the expected target. In addition, Ripple has not publicly disclosed the profitability of its cross-border payment business, and relies more on the sale of XRP tokens to maintain its operations, resulting in substantial benefits for its founding team and shareholders. It is worth noting that the vast majority of XRP tokens are still held by Ripple, and Ripple sells a certain amount of XRP every quarter.
Furthermore, XRP's past performance has not significantly changed the public's perception of its potential in the Web3 field, which has led some investors to question its future market role. However, Ripple has clearly recognized this challenge and is taking proactive measures to enhance the future development potential of XRP. Recently, Ripple has launched the RLUSD stablecoin, expanded the XRPL ecosystem, and some institutions such as Bitwise Asset Management have also submitted XRP ETF proposals, indicating that XRP remains a key component of Ripple's future development. Despite the challenges, the future of XRP is still worth looking forward to.
