XRP can be classified as both a fundamental asset and a utility asset, depending on the approach taken. Let's explain.

1. Utility Asset

XRP is primarily used within the Ripple ecosystem to facilitate fast, cheap, and efficient cross-border payments. This is where it gains its value as a utility token because it has a clear and defined use:

  • Acting as a bridge currency in the RippleNet network to transfer value between different currencies and countries.

  • Solving liquidity issues and reducing costs for financial institutions.

  • This functionality makes XRP a utility asset within the niche of global payments.

2. Fundamental Asset

On the other hand, XRP can also be considered a fundamental asset because:

  • It is one of the oldest and most established cryptos in the market (created in 2012).

  • It has a strong use case in the international payments sector, supported by strategic partnerships with global financial institutions.

  • It has a significant market capitalization, positioning it as one of the main assets of the crypto ecosystem.

  • Its network, XRPL (XRP Ledger), offers fast, scalable, and energy-efficient transactions, with potential for other use cases beyond RippleNet (such as NFTs and DeFi).

These features elevate it above many other utility assets, consolidating it as a fundamental asset in the crypto ecosystem.

3. A Dual Classification

XRP maintains its role as a utility asset due to its specific use in cross-border payments, but it can also be considered a fundamental asset due to its strength, institutional adoption, and key role in the global payments sector.

In this sense, we can say that it meets both categories depending on the angle from which its function is evaluated. The combination of being a clear utility token and having solid fundamentals gives it a privileged position in the market. [◽]

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