Author: Daniel Li, CoinVoice
Recently, the cryptocurrency market has seen multiple positive developments, and Ripple (XRP), a long-established public blockchain, has become the focus of the market. The news that Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), is about to step down has ignited the market's expectations for a more friendly regulatory environment. At the same time, the long-running legal dispute between Ripple and the SEC is also expected to be resolved. Court rulings have repeatedly sent positive signals to Ripple, clearing some obstacles for the development of XRP. This series of positive developments has helped push XRP prices to a strong rebound, soaring by more than 250% in just one month, and the single-day increase exceeded 35%, setting a new high in nearly three years, rekindling investor enthusiasm.
As one of the pioneers in the blockchain field, XRP has been focusing on cross-border payment scenarios since its launch in 2012, and has been favored by financial institutions for its high efficiency, low cost and technological innovation. However, the growth of this classic coin has not been smooth sailing. It has faced pressure from market competition and has been frustrated by regulatory disputes. Today, with the regulatory environment gradually shifting and market confidence boosted, XRP seems to be seizing this historic opportunity to redefine its future market positioning. As a "veteran" in the field of cryptocurrency, can XRP open up an innovative track again and lead the future of blockchain payments? Let's find out.
01 Regulatory Favors SEC Ethereum Concept Coin XRP Hits Three-Year High
The dust has settled on the 2024 US presidential election, and Republican candidate Donald Trump was elected as the next president with a high vote. During the campaign, Trump promised to make the United States the "global cryptocurrency capital" and strongly supported the crypto industry. This position undoubtedly brought a huge confidence boost to the market and pushed up the prices of multiple cryptocurrencies, including XRP. In this wave of market recovery, XRP, dubbed the "Enemy Concept Coin", ushered in a turnaround, hitting a three-year high and becoming the focus of investors. However, the rise of XRP is not only due to Trump's campaign promises, but also stems from a series of changes in the regulatory environment and key progress in Ripple's four-year difficult lawsuit with the U.S. Securities and Exchange Commission (SEC).
Regulatory changes provide catalyst for the market
Since the end of 2020, Ripple has been sued by the SEC for allegedly raising funds through unregistered securities, and XRP has been under regulatory pressure for four years. The SEC accused Ripple of issuing XRP since 2013, raising $1.3 billion, and believed that its actions violated securities laws. This lawsuit not only caused the price of XRP to fall sharply, but also forced multiple exchanges to suspend XRP trading, and market confidence was severely hit.
However, as the legal dispute gradually comes to an end in 2024, XRP has experienced a long-lost turn. In 2023 and 2024, rulings by New York federal judge Analisa Torres brought important breakthroughs to Ripple. She determined that Ripple’s sale of XRP to retail investors did not violate securities laws, but that its sales to institutional investors were illegal and required Ripple to pay a $125 million fine. This ruling is significantly lower than the $2 billion fine originally requested by the SEC and also leaves room for Ripple’s future operations. More importantly, this judgment releases the market’s signal for the future development of XRP and alleviates excessive concerns about supervision.
New SEC Chairman May Bring More Positives to XRP
Another important factor driving XRP's recovery is the news of the resignation of SEC Chairman Gary Gensler. Gensler is one of the most controversial regulators in the cryptocurrency industry in recent years. His strict regulatory policies once put many crypto projects in trouble. However, as Gensler will step down in January 2025, the market's expectations for the new SEC chairman have increased significantly. Many people expect that the new SEC leadership team may take a more relaxed and friendly attitude towards the crypto industry, thus bringing hope to XRP and other projects that have been suppressed by regulation.
(The Washington Post) According to reports, Trump's advisory team is evaluating several SEC chairman candidates, including officials and financial executives who 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 chairman really pushes for a policy shift as expected, then Ripple's lawsuit may be settled or even withdrawn, and the regulatory environment of the entire cryptocurrency industry may also change fundamentally. For projects that have been suppressed, such as Ripple, Binance, Coinbase, etc., this is undoubtedly a major policy benefit.
Ripple changes litigation dilemma through political action
Ripple's "revenge" does not only rely on changes in laws and regulations, but the company's active involvement in the political field has also become part of its tactics. According to CoinDesk, Ripple Labs has injected $25 million into the cryptocurrency industry's Fairshake Political Action Committee (PAC) to influence the 2026 U.S. congressional elections and promote more friendly cryptocurrency regulatory policies. Ripple's move marks the beginning of the company's use of political means to try to reverse its litigation dilemma with the SEC through policy reforms and strive for a more favorable legal and regulatory environment for XRP.
In addition, Reuters reported that several cryptocurrency companies including Ripple (such as Circle, Kraken, Coinbase, a16z, Paradigm, etc.) 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 companies participating in it will have the opportunity to directly influence future policy trends, especially under the crypto-friendly policy framework promoted by the Trump administration. If Ripple can gain a place in this process, it will be able to gain more support for XRP at the policy level, thereby gaining more freedom in the future regulatory environment.
02 XRP: Innovator of Traditional Financial Payment System
Over the past few 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 need to be solved. High transaction fees, inefficient payment processing speed, and the complexity and high cost of cross-border payments have become bottlenecks that hinder global financial liquidity and market development. In order to solve these problems, Ripple launched XRP (Ripple coin) and XRP Ledger (Ripple ledger), and with its innovative technical architecture and unique business model, it quickly emerged and became an important force in promoting the innovation of the traditional financial payment system.
What is XRP vs. Ripple?
XRP is the native cryptocurrency in the Ripple network and 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 new solution for global payments through blockchain technology. Ripple has greatly increased the speed of transactions, reduced costs, and provided payment capabilities across borders and connecting different currencies through its innovative Ripple Protocol Consensus Algorithm (RPCA) and decentralized XRP Ledger. XRP is essentially a bridge currency that can exchange between different legal currencies efficiently and at low cost, providing a smoother path for global payments and cross-border settlements.
Ripple, a technology company dedicated to promoting innovation in the financial system, was founded in 2012 by Chris Larsen and Jed McCaleb. Ripple's initial goal was to transform the existing financial payment system through blockchain technology, especially to solve the high costs and inefficiencies in the traditional bank settlement system. Ripple's vision is not only to create a new cryptocurrency, but more importantly to establish a decentralized, global financial network that connects global banks, payment service providers and financial institutions through RippleNet to achieve faster, cheaper and more efficient payments and transactions.
XRP's technical advantages: high 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 such as Bitcoin and Ethereum, XRP uses a unique consensus mechanism, the Ripple Protocol Consensus Algorithm (RPCA). This algorithm does not rely on traditional proof-of-work (PoW) or proof-of-stake (PoS) mechanisms, but instead reaches consensus through a group of independent validator nodes to ensure the validity of transactions. This design enables the XRP network to complete transaction verification within a few seconds, and the transaction fee is relatively low, usually only 0.00001 XRP, which greatly reduces the high transaction fees and time delays common in traditional financial payments.
Compared to Bitcoin's transaction processing speed of only 7 transactions per second, XRP Ledger can process 1,500 transactions per second, and with the continuous optimization of technology, the throughput will be further improved in the future. This efficient transaction processing capability makes XRP an ideal choice for cross-border payments and fund transfers, especially in scenarios that require fast settlement and large payments, XRP shows unparalleled advantages.
XRP’s role in the global payment system: innovation in cross-border payments
One of the core advantages of XRP is its ability to provide efficient and low-cost payment solutions between different countries and regions, especially in the field of cross-border payments. Traditional cross-border payments usually rely on multiple intermediary banks and complex settlement processes, which not only increases the time cost of transactions, but also makes the payment fees high. According to data from the Society for Worldwide Interbank Financial Telecommunication (SWIFT), traditional cross-border payments usually take 2 to 3 working days, and the handling fee is usually 5% to 10% of the payment amount. This inefficient and high-cost payment method has become a bottleneck in global financial transactions and commercial activities.
XRP has completely changed this situation through its innovative On-Demand Liquidity (ODL) technology. ODL technology allows users to make instant cross-border payments without pre-capitalization using XRP as a bridge currency. 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 it may take several days to complete the transaction. With XRP, users can complete payments in seconds, and the fees are much lower than traditional payment methods. This efficient, convenient and low-cost payment method has greatly improved the efficiency of global trade and capital flows.
Ripple has gradually established a wide payment network around the world through cooperation with many banks, payment service providers and financial institutions around the world. This enables XRP to not only play an important role in the traditional financial field, but also make breakthroughs in the payment and remittance fields in emerging markets and developing countries, further promoting the development of financial inclusion.
Advantages of Ripple and XRP: Combination of Bank Cooperation and Decentralization
XRP's success in the global payment system is inseparable from its in-depth cooperation with traditional banks and financial institutions. Ripple has always adhered to the concept of "cooperating with traditional financial institutions rather than confronting them". By establishing partnerships with leading global financial institutions, XRP has been rapidly promoted in the existing financial infrastructure. For example, Ripple has launched strategic cooperation with many large banks and payment platforms such as Bank of America, Credit Suisse, and Mitsubishi UFJ Financial Group to promote the application of XRP in cross-border payments and settlements. These partnerships have not only enhanced XRP's market awareness, but also laid a solid foundation for its further expansion in the field of financial services.
However, the integration of XRP with the traditional banking system does not mean that it loses its decentralized nature. XRP Ledger is a decentralized public blockchain that anyone can join and become a validator. This means that even if Ripple no longer exists, the XRP network will continue to operate. The decentralized design ensures that XRP is not controlled by a single institution, which is a key advantage that distinguishes it from the traditional financial system.
In the future, XRP may not only be limited to the field of cross-border payments, but its application potential in emerging fields such as decentralized finance (DeFi) and asset tokenization is 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 fields, XRP is expected to become an indispensable part of the global payment system and become a new global currency.
03 From traditional finance to Web3 industry: Ripple’s long-term layout and the future of XRP
Although Ripple is a blockchain company, its main focus in the past has always been on the traditional financial sector. With the rapid development of global financial technology, the transformation from traditional finance to the Web3 industry has become the mainstream trend in the financial market, and Ripple has also begun to gradually deploy the Web3 industry. However, unlike many cryptocurrency projects, Ripple does not limit its vision to the field of pure digital currency, but promotes the diversification of its products and services from a broader perspective. Ripple focuses on Web3 fields such as decentralized finance (DeFi), stablecoins and asset tokenization. It is worth noting that although XRP itself has no direct role in these strategic directions of Ripple, Ripple's long-term layout has given XRP a broader application prospect in the future.
Ripple's robust strategy: Compliance-based and expanding Web3 cooperation
Unlike many cryptocurrency projects that are eager for quick success and highly speculative, Ripple has always adhered to a robust core strategy and is committed to promoting innovation within a compliance framework. During the four-year litigation with the U.S. Securities and Exchange Commission (SEC), Ripple's strategic direction has become clearer, further strengthening its concept of steady development. From initially positioning XRP as a cross-border payment tool to actively deploying Web3 today, Ripple has always maintained compliance and worked closely with traditional financial institutions. This strategy not only enhances the market's trust in Ripple, but also makes its layout in the Web3 field more forward-looking and sustainable.
In terms of compliance, Ripple has made remarkable achievements. The company and its subsidiaries hold nearly 40 US money transmission licenses, New York BitLicense, the main payment institution license of the Monetary Authority of Singapore, and the virtual asset service provider (VASP) registration of the Central Bank of Ireland, ensuring its legal operations in multiple countries and regions. These qualifications provide Ripple with strong compliance protection and further enhance its credibility as a global financial service provider.
Ripple's global network partnerships also provide strong support for its expansion in the Web3 field. The company has established in-depth cooperation with more than 100 banks and financial institutions around the world, including well-known institutions such as Santander Bank and Mitsubishi Bank. These cooperations not only enhance Ripple's influence in the traditional financial field, but also provide more practical application scenarios for the use of XRP. In addition, Ripple cooperates with platforms such as Archax to actively promote the tokenization of real-world assets (RWA) and help traditional financial assets smoothly enter the blockchain ecosystem. At the same time, Ripple is also making arrangements in the field of "institutional-level DeFi". Through cooperation with platforms such as OpenEden, it invests in projects such as tokenized treasury bonds, creating new opportunities for further cooperation with financial institutions. Recently, the XRP ETF proposal submitted by companies such as Bitwise Asset Management has aroused widespread market attention to the future potential of Ripple, further verifying its strategic advantages in the integration of Web3 and traditional finance.
XRP and Web3: Challenges and opportunities of adapting to transformation
Although 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. These characteristics make the role of XRP in Web3 completely different from its role as a bridge currency in cross-border payments. Although XRP's technical advantages and efficient transaction mechanism are still worthy of recognition, the biggest challenge it faces in the Web3 ecosystem is how to closely match the needs of emerging fields such as decentralized finance (DeFi). 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 through a number of initiatives, gradually penetrating into other key technology areas of the Web3 industry. According to BlockBeats, on November 30, FOX Business quoted people familiar with the matter as saying that the New York Department of Financial Services has told Ripple that it will approve 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 to XRP to enhance its role in Ripple's payment solutions. This strategy will not only help consolidate XRP's market position in the payment field, but also open 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 decentralized finance (DeFi).
What does the future hold for XRP?
After Trump's election, the crypto industry is optimistic about future regulatory policies. This change has brought new opportunities to the traditional financial industry that has long been eager to enter the crypto market. As a long-term traditional financial company, Ripple has attracted a lot of attention from investors due to its potential and influence in the field of cross-border payments. XRP's recent price trend also reflects this trend. Recently, XRP broke through the 5-year dynamic resistance level. Some optimistic crypto analysts believe that XRP's next target price may reach $4.2. Driven by market sentiment and favorable policies, XRP is expected to break through the historical high of $3.317 set in 2018 in the short term.
However, there are still many controversies about the future prospects of XRP. On the one hand, the new chairman of the U.S. Securities and Exchange Commission (SEC) has not yet been determined, which makes Ripple face certain regulatory uncertainties and potential compliance risks. On the other hand, since its launch in 2012, XRP has not performed as well as expected. Although Ripple has announced plans to use XRP for cross-border payments, there are actually few signs that the actual frequency of use 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 operations, resulting in its founding team and shareholders benefiting greatly from it. It is worth noting that the vast majority of XRP tokens are still in the hands of Ripple, and Ripple sells a certain amount of XRP every quarter.
Furthermore, XRP’s past performance has failed to significantly change public perceptions of its potential in the Web3 space, leading some investors to question its future market role. However, Ripple is clearly aware of this challenge and is taking active steps to enhance XRP’s future development potential. Recently, Ripple launched the RLUSD stablecoin to expand the XRPL ecosystem, and some institutions such as Bitwise Asset Management have also submitted XRP ETF proposals. These initiatives indicate that XRP is still a key component of Ripple's future development. Despite the challenges, XRP’s future is worth looking forward to.
