In the period from November 2024 to February 2025, crypto investors saw plenty of evidence of the remarkable upside potential of XRP (XRP 2.66%). In just three months, the price of XRP exploded, from $0.50 to $3.40.
Admittedly, the price of XRP has traded back down to the $3 level since then. But there are two very good reasons why XRP might still have plenty of explosive upside potential ahead.
Imminent arrival of spot XRP ETFs
While XRP remains the third-largest cryptocurrency by market cap, it has never been a big favorite of institutional buyers. A good reason for that is that there has never been a convenient, efficient, and cost-effective way for them to get exposure to it. Buying XRP meant dipping their toes into the deep end of the crypto pool.
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That’s the problem the new spot XRP ETFs (exchange-traded funds) are supposed to fix. Suddenly, it will be as easy to buy XRP as it is to buy any ETF. So investors are understandably anticipating the imminent arrival of the spot XRP ETFs later this year. The Securities and Exchange Commission (SEC) is reviewing the applications of a handful of investment firms, and will likely render a decision by mid-October.
Right now, Bloomberg is giving these spot XRP ETFs an 85% chance of approval this year. Online prediction markets appear to agree, giving them a 78% chance of approval. There are just a few is to dot and ts to cross, but the new spot XRP ETFs should start trading by the end of the year.
When they do, they could unleash a wave of new money into XRP. According to JPMorgan Chase (NYSE: JPM), as much as $8 billion in new money could flow into XRP. The conventional wisdom says that all of this new money will push XRP higher, much like the arrival of the spot Bitcoin ETFs in January 2024 helped to push Bitcoin higher last year.
XRP is not the only altcoin rumored to be getting a spot ETF this year. Many have already suggested that 2025 will be the year of the altcoin ETF, and other potential prospects include Solana (CRYPTO: SOL) and Litecoin (CRYPTO: LTC). But market sentiment is not as bullish on these two altcoins, and I’m expecting XRP to be the star of the altcoin ETF show going forward.
A new wave of institutional adoption
It’s important to keep in mind that XRP is both a cryptocurrency and a blockchain. The cryptocurrency is a key component of the Ripple payment network, helping to enable activities such as cross-border payments. Right now, there are a lot of exciting things going on behind the scenes with Ripple (the company that launched the XRP token), helping to push XRP higher over the next few months.
For example, Ripple has been working on new real world asset (RWA) tokenization initiatives that will use the XRP blockchain. One of the best examples of this to date is Ripple’s partnership with BlackRock (NYSE: BLK) that will tokenize U.S. Treasuries and put them on the XRP blockchain, where they can be easily traded.
Ripple is also working on new stablecoin initiatives. In December 2024, Ripple launched a new stablecoin called Ripple USD (CRYPTO: RLUSD) that is designed to boost usage of the XRP crypto token. In August, Ripple USD hit a $600 million market cap and now ranks among the top 110 cryptocurrencies.
All this points to a new wave of institutional adoption for XRP. Perhaps it’s not as much as some people would like, but it’s certainly on the upswing. In fact, earlier this year, Ripple CEO Brad Garlinghouse boldly suggested that one day, XRP could become the backbone of a payment system to rival SWIFT. Instead of running on legacy tech infrastructure that’s over 50 years old, transactions would run on super-fast, super-efficient blockchain technology powered by XRP.
Beware the XRP fakeout
Of course, caveats abound when it comes to XRP. In many ways, XRP trades like a meme coin. Hype and speculation often run rampant in the XRP investment community. Case in point: There is still buzz that Ripple will be going public via an IPO soon, despite public statements from Ripple’s top executives to the contrary.
Of course, there are still regulatory issues swirling around XRP and Ripple. The long-running SEC court case against Ripple was supposed to wind up earlier this year, but the case is still not yet over. That’s important, because all indications are that the SEC will not approve a spot XRP ETF until every last regulatory issue has been put to bed.
So where do we go from here? According to Standard Chartered, XRP is going to hit $5.50 this year before soaring to a price of $12.50 by the end of 2028. That seems ultra-optimistic to me, but I can easily see XRP doubling by the end of next year. That makes it the highest-upside cryptocurrency you can buy right now.
JPMorgan Chase is an advertising partner of Motley Fool Money. Dominic Basulto has positions in Bitcoin, Solana, and XRP. The Motley Fool has positions in and recommends Bitcoin, JPMorgan Chase, Solana, and XRP. The Motley Fool recommends Standard Chartered Plc. The Motley Fool has a disclosure policy.