Key Points
Most major banks that use Ripple's payment technology bypass XRP entirely, undermining the token's core institutional demand narrative.
XRP's bridge asset use case generates transaction volume but not lasting buy pressure.
Ripple itself is now heavily focused on its stablecoin, RLUSD.
- 10 stocks we like better than XRP ›
XRP (CRYPTO: XRP) is hovering just below $1.50 after falling 50% in the last six months -- some may see it as an opportunity. But before you buy the dip, it's worth understanding what actually drives -- or doesn't drive -- XRP's value.
Ripple, the company behind XRP, has built real partnerships with major financial institutions. Its settlement technology genuinely improves upon legacy banking systems. The problem is that most of the banks that use Ripple's technology do so without ever touching XRP itself.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Ripple's success isn't necessarily XRP's success
The token's value proposition hinges on Ripple's liquidity feature, which uses XRP as a bridge asset for cross-border transfers. But this use of Ripple's payment infrastructure primarily serves smaller fintechs and remittance providers, not the marquee banking names that make headlines.
And because even when these institutions use the service, the currencies are converted in and out of XRP almost instantly; each buy order is matched with a corresponding sell -- creating volume without sustained demand pressure from these institutions holding XRP in reserve.
Image source: Getty Images.
Stablecoins could pose a further problem
There's also a growing competitive threat: stablecoins. Ripple recognizes this, and its own stablecoin, RLUSD, is now a featured part of the Ripple ecosystem. This shift will, in my view, cannibalize XRP's role as a bridge asset.
Ripple, the company, may thrive as a payments infrastructure provider. But that potential success doesn't necessarily translate to XRP token appreciation.
Therefore, I wouldn't buy XRP today, even at these lower prices.
Should you buy stock in XRP right now?
Before you buy stock in XRP, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and XRP wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $456,188!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,133,413!*
Now, it’s worth noting Stock Advisor’s total average return is 916% — a market-crushing outperformance compared to 194% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of February 27, 2026.
Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends XRP. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
