The cryptocurrency market has encountered significant fluctuations throughout the past year, marked by an approximate 9% reduction in the combined market capitalization of digital currencies. These declines have been primarily attributed to heightened economic uncertainty which has prompted investors to retreat from riskier assets, coupled with the unwinding of leveraged positions within the sector.
Among major cryptocurrencies, XRP has notably struggled, experiencing a 22% drop in its price over the previous twelve months, closing near $2.08. Despite this, Geoffrey Kendrick, who leads digital asset research at Standard Chartered Bank, projects a resurgence. He expects XRP's value to reach $12.50 by 2028, signifying an anticipated appreciation of roughly 500%. This forecast hinges upon anticipated regulatory clarity and the broader acceptance of spot exchange-traded funds (ETFs) linked to XRP.
XRP Ledger's Role in Streamlining Cross-Border Payments
XRP functions as the native token within the XRP Ledger, a blockchain network engineered for rapid and cost-efficient cross-border transactions. Financial technology firm Ripple operates on this blockchain infrastructure, delivering real-time payment services targeting financial institutions including banks, payment providers, and cryptocurrency-based enterprises.
Traditional international transactions are largely conducted through the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network. Ripple contends that this existing system typically requires three to five days to finalize settlements, incurring substantial fees due to its complex routing across multiple intermediaries. In contrast, XRP facilitates near-instant settlements with minimal fees, effectively addressing these inefficiencies.
The SWIFT system processes an estimated $150 trillion in annual transaction volumes. Ripple's CEO Brad Garlinghouse has suggested that XRP could manage approximately 14% of that volume within several years, potentially overseeing more than $20 trillion annually. Such an increase in transactional throughput would likely result in substantial demand for XRP, exerting upward pressure on its price. Nevertheless, this forecast remains subject to scrutiny.
A key concern lies in the inherent volatility of cryptocurrencies. Utilizing a fluctuating asset like XRP for monetary transfers can introduce risk, even with accelerated settlement speeds. Stablecoins, which maintain a consistent value, present a more secure alternative. Ripple introduced the stablecoin Ripple USD (RLUSD) into its payment framework in December 2024 to address this issue, though its market influence has been limited to date. Transaction volumes involving XRP have, in fact, decreased over the last year, signaling challenges in adoption.
Despite these obstacles, Kendrick sees future growth prospects fueled by expanding deployment. He stated, "XRP is uniquely positioned at the heart of one of the fastest-growing use cases for digital assets -- facilitation of cross-border and cross-currency payments." This perspective underscores the strategic relevance of XRP in the evolving digital finance ecosystem.
Spot XRP ETFs as Catalysts for Investor Demand
Investor comfort with digital assets like XRP has increased both among retail and institutional participants, though market friction remains. Cryptocurrency exchanges often impose elevated transaction fees, and the need for segregated accounts when trading cryptocurrencies versus traditional stocks complicates investment processes.
Recent regulatory developments mark a turning point in market accessibility. Since November, the U.S. Securities and Exchange Commission (SEC) has begun approving spot XRP ETFs, enabling investors to purchase XRP exposure through regulated brokerage platforms at comparatively low costs. Currently, six spot XRP ETFs are available on U.S. exchanges. The Franklin XRP ETF (ticker: XRPZ), for instance, offers an expense ratio of 0.19%, substantially lower than transaction costs typically charged by cryptocurrency exchanges such as Coinbase or Robinhood for trades below $50,000.
Beyond retail engagement, these ETFs have the potential to open the market to institutional investors who oversee assets totaling approximately $147 trillion as of mid-2025. Even modest allocations by these entities into XRP via ETFs could meaningfully elevate the cryptocurrency's price. Kendrick forecasts that influxes into spot XRP ETFs might reach $4 billion to $8 billion in their inaugural year.
Assessing the Viability of XRP's Price Forecast
While the outlined bullish outlook is supported by certain growth indicators, skepticism remains regarding the extent of XRP's potential expansion. The competitive advantage of stablecoins and entrenched market leaders like USDC poses significant challenges for Ripple USD's market penetration. This casts doubt on XRP's likelihood of becoming a dominant solution for cross-border payments.
Consequently, XRP's price increase may primarily derive from ETF-related demand rather than widespread adoption in payment systems. Moreover, institutional investors' preference is currently aligning more with Bitcoin, given its established market presence and liquidity. Notably, spot XRP ETFs accumulated $1.4 billion in net inflows within their first two months post-launch, while spot Bitcoin ETFs achieved this milestone in under one month.
In summary, while regulatory progress and new investment vehicles suggest promising developments for XRP, realizing the forecasted $12.50 price by 2028 depends on overcoming significant adoption challenges and competing preferences within the digital asset landscape.