Is XRP a Millionaire-Maker Cryptocurrency?

With prices up by almost 400% over the last 12 months, XRP (XRP -2.61%) has recently begun leading the pack among large, blue chip cryptocurrencies, beating Bitcoin‘s return by over 4x over the same timeframe. But can the boom times continue? Let’s dig deeper to see if XRP still has what it takes to mint more millionaires over the long term.

A utility-focused cryptocurrency

When it launched in 2012, XRP made a name for itself by fixing some of the shortcomings of older platforms. Unlike Bitcoin, it aimed to disrupt the international payments market with a focus on transaction speed and rock-bottom fees (currently 0.00001 XRP per transaction).

Now, rapidly evolving blockchain technology means newer blockchain networks often outperform XRP from a technical standpoint. But the asset’s brand recognition and active development team (Ripple Labs) could represent a sustainable economic moat. In finance, trust is everything, and Ripple Labs has leveraged this to create new products. One of them is RippleUSD (CRYPTO: RLUSD), a dollar-pegged stablecoin, which can also serve as a store of value and facilitate international money transfers.

While RippleUSD is a separate entity from XRP, it uses the same ledger. Its transaction fees are paid with XRP and removed from circulation (burned), so adoption of RippleUSD will directly benefit XRP.

Ripple Labs is also benefiting from regulatory wins. In August, the Securities and Exchange Commission (SEC) ended its appeal of an earlier ruling that found that Ripple’s sales of XRP to retail investors did not violate securities law. While Ripple Labs is still on the hook for a $125 million fine related to its XRP sales to institutional investors, the settlement is good news because it gives large investors more clarity on how to deal with XRP tokens and comply with regulations.

An excellent hedge against economic uncertainty

Cryptocurrency returns are often influenced by macroeconomic factors outside of their developers’ control. In the near term, respected blue chip cryptocurrencies like XRP can help protect investors’ portfolios from rising economic and monetary uncertainty in the U.S. economy.

Washington has become increasingly worried about America’s trade deficit, which stands at $1.2 trillion as of 2024. As the Trump administration tries to tackle this issue through tariffs and renegotiated trade deals, investors seem to be getting spooked about the dollar’s valuation — sending the dollar index down 9.4% since the start of the year.

The nation’s rising debt level (currently over $37.2 trillion) is also causing concerns about fiscal sustainability and a potential debt crisis.

As a digital currency, XRP is distinct from a stock or bond in that its value isn’t pegged to the U.S. dollar. Like traditional currencies, its value will generally go up when the dollar goes down, providing U.S. investors with a hedge against devaluation and other problems in this specific economy.

Is XRP still a millionaire-maker?

Since its launch over a decade ago, XRP’s price has risen by roughly 19,280%, easily making millionaires out of its medium-sized investors. For example, a starting position of just $10,000 would be worth around $1.9 million today. That far exceeds a similar position in the S&P 500, which would be worth a relatively measly $38,000 over the same timeframe.

XRP Price data by YCharts.

That said, with a market cap of $172 billion, XRP is already one of the largest digital assets in the world — just behind Bitcoin and Ethereum. Its size will make it more challenging to generate multi-bagger returns in the future. However, with compelling regulatory tailwinds and rising uncertainty in the U.S. monetary system, XRP still looks capable of trouncing the S&P 500. That makes it an excellent long-term pick for investors who are willing to hold through the ups and downs.