The Future of Cryptocurrency: Why Ripple Will Win (But XRP Holders Might Not)
By Michael Kelman Portney
Introduction: The Disconnect Between Technology and Tokens
The cryptocurrency revolution is real. Blockchain technology is fundamentally changing how we think about money, ownership, and trust. Digital assets are becoming increasingly integrated into the global financial system, and this trend is irreversible. But here's what most retail investors miss: the success of blockchain technology doesn't automatically translate to returns for token holders.
Nowhere is this disconnect more visible than with Ripple and XRP. Ripple Labs has built genuinely innovative technology that solves real problems in cross-border payments. Banks and financial institutions are partnering with Ripple. The company is valued at billions of dollars. By almost any measure, Ripple is succeeding.
But that doesn't mean XRP—the token retail investors can actually buy—will ever be worth much.
This isn't FUD (fear, uncertainty, and doubt). This isn't a hit piece from someone who "doesn't understand the technology." This is a clear-eyed analysis of the incentive structures, business models, and market realities that separate successful crypto companies from successful crypto investments.
Part 1: Why Cryptocurrency Is The Future
Before we get to Ripple and XRP specifically, let's establish something important: blockchain technology and digital assets are here to stay. The question isn't whether crypto has a future—it does. The question is which assets capture value and why.
The Case for Digital Assets
The fundamental innovations of cryptocurrency—decentralized consensus, cryptographic security, programmable money, and borderless transactions—solve real problems that traditional finance struggles with. Bitcoin proved you can have a monetary system without central control. Ethereum proved you can have financial contracts that execute automatically without intermediaries. These aren't gimmicks. These are genuine technological advances.
Cross-border payments, for example, are still embarrassingly slow and expensive in 2025. SWIFT, the dominant messaging system for international bank transfers, was created in the 1970s. It can take days for money to move between countries, with fees eating into the transferred amount at every step. This isn't because banks are incompetent—it's because the correspondent banking system is genuinely complex, involving multiple intermediaries, currency conversions, and compliance checks.
Blockchain technology offers a potential solution. Transactions can settle in seconds rather than days. Costs can be dramatically lower. Transparency is built into the system. The technology works. This is why banks and financial institutions are investing billions in blockchain research and implementation.
The Institutional Adoption Wave
We're seeing real institutional adoption across the cryptocurrency space. This isn't speculation—it's observable reality.
Bitcoin has achieved legitimacy as "digital gold." BlackRock, the world's largest asset manager, launched a Bitcoin ETF that accumulated over $40 billion in assets in its first year. MicroStrategy, a publicly-traded company, holds over 500,000 Bitcoin as a treasury reserve asset. Nation-states like El Salvador have made Bitcoin legal tender. These aren't fringe actors—these are massive institutions with sophisticated risk management making long-term strategic bets.
Stablecoins have become the killer app for blockchain payments. Tether (USDT) and Circle's USDC process hundreds of billions in transaction volume annually. These aren't speculative assets—they're actual utility. Businesses use them for international payments. Traders use them for liquidity. They've become infrastructure. Tether is preparing for what could be one of the largest IPOs in history, which tells you everything about the actual demand and profitability of blockchain-based payments.
Ethereum has established itself as the foundation for decentralized finance (DeFi) and smart contracts. While the ecosystem has challenges, the core use case—programmable financial agreements that execute without intermediaries—has proven itself with billions in total value locked.
The point is this: cryptocurrency is not going away. The technology has proven its utility. Institutional adoption is accelerating. The regulatory environment is maturing. This is the future of finance.
Part 2: Why Ripple Will Be Huge
Now let's talk about Ripple specifically, because Ripple Labs has genuinely built something impressive.
RippleNet: Solving Real Problems
Ripple identified a real pain point in global finance: cross-border payments are slow, expensive, and opaque. Their solution, RippleNet, is a payment network that connects banks and payment providers to facilitate instant, low-cost international transfers with real-time tracking.
This isn't vaporware. RippleNet works. Banks can see transactions in real-time. Settlements happen faster than SWIFT. The messaging layer is superior to legacy systems. This is why over 300 financial institutions have partnered with Ripple to some degree. The technology solves actual problems.
Enterprise Software Revenue
Here's what's crucial to understand: Ripple makes money selling enterprise software to financial institutions. This is a legitimate business model. Banks pay licensing fees to use RippleNet. They pay for implementation and integration services. They pay for ongoing support and maintenance.
This is how Ripple has built a company valued at approximately $15 billion as a private entity. Not through XRP speculation—through actual revenue from actual customers paying for actual software that provides actual value.
The Regulatory Victory
The SEC lawsuit against Ripple, which dragged on for years, has been resolved. While Ripple paid a fine for institutional sales of XRP, the court ruled that XRP sold on exchanges was not a security. This was a significant victory that removed a major regulatory overhang.
With regulatory clarity achieved, Ripple can operate more freely in the United States. This is unambiguously good for Ripple as a company. It removes legal uncertainty, opens up potential partnerships, and validates their business model.
Strategic Positioning
Ripple has positioned itself intelligently in the blockchain space. Rather than trying to be everything to everyone, they focused on a specific use case—institutional cross-border payments—and built deep expertise and relationships in that vertical. They've partnered with central banks exploring digital currencies. They've worked with regulators to shape policy. They've built the kind of institutional relationships that take years to develop.
The company has also hedged its bets. Recognizing that financial institutions need price stability for payments, Ripple launched RLUSD, a US dollar-pegged stablecoin. They've partnered with Bank of New York Mellon for custody solutions. They're building a comprehensive ecosystem for institutional digital asset usage.
Ripple, the company, is almost certainly going to continue growing. They have real revenue, real customers, real technology, and increasingly clear regulatory frameworks. The future looks bright for Ripple Labs.
Part 3: Why XRP Might Not Follow
Here's where we need to separate the success of Ripple (the company) from the success of XRP (the token that retail investors can buy). These are not the same thing.
The Fundamental Misalignment
When retail investors buy XRP, they're not investing in Ripple. They own no equity in the company. They have no claim on Ripple's revenue from software sales. They receive no dividends from Ripple's profits. They own a token that may or may not be used by the banks that pay Ripple for software.
This is the first critical disconnect. The valuable asset is Ripple equity, not XRP tokens. Ripple is a private company. You cannot invest in it. The insiders and venture capitalists who own Ripple equity are positioned to capture the value from Ripple's success. Retail investors holding XRP are not.
Think about this structure carefully. If you were Ripple's CEO and you knew with certainty that XRP would become the global standard for banking settlement and appreciate to $10,000 per token, would you keep the company private? Or would you take it public so that retail investors could invest in the company that owns 50 billion XRP and benefits from every partnership and every use case?
They've kept it private. That tells you where the smart money thinks the value lies.
RippleNet Without XRP
Here's the uncomfortable truth that XRP holders often ignore: banks can use RippleNet without touching XRP.
RippleNet has multiple products:
xCurrent (now part of RippleNet): Messaging and settlement solution for banks that works with traditional correspondent banking
xRapid (now "On-Demand Liquidity" or ODL): The product that actually uses XRP for liquidity
Most of Ripple's 300+ partnerships use xCurrent/RippleNet messaging without XRP. Banks get the benefit of faster messaging, better tracking, and improved settlement coordination—all without holding or using a volatile cryptocurrency.
This makes perfect sense from the banks' perspective. They can modernize their payment infrastructure using Ripple's technology while avoiding cryptocurrency price volatility, regulatory uncertainty, treasury management complexity of holding crypto, and counterparty risk with Ripple Labs.
The banks that pay Ripple for RippleNet software are getting value. Ripple is getting revenue. But XRP is unnecessary for this transaction. The value exchange happens entirely without the token.
The Stablecoin Problem
Even when banks do want to use blockchain for settlement and liquidity, they're choosing stablecoins, not XRP.
Think about the actual use case for cross-border payments from a bank's perspective. If Bank A wants to send $10 million to Bank B, what do they want?
Bank A converts $10 million to the transfer asset
Asset moves across the blockchain instantly
Bank B receives the asset and converts it
Bank B has exactly $10 million
For this to work reliably, the transfer asset needs price stability. If the asset's value fluctuates during the transfer, you introduce currency risk into what should be a simple payment. This is why stablecoins have dominated blockchain-based payments. USDC and USDT maintain a 1:1 peg with the US dollar. When you send $10 million USDC, the recipient gets $10 million in value. Always.
XRP, by contrast, is volatile. Its price fluctuates. If a bank converts $10 million to XRP, sends it across the network, and the recipient converts back to dollars, there's no guarantee they'll receive exactly $10 million. This price risk makes XRP fundamentally less suitable for payment settlement than stablecoins.
Ripple understands this, which is why they launched RLUSD—their own stablecoin. If XRP was perfect for institutional settlement, why would Ripple create a competing product? Because they know institutions need price stability that XRP cannot provide.
The Math Problem
Let's address the "$10,000 XRP" narrative that circulates in retail communities. This is presented as serious analysis, often attributed to David Schwartz (Ripple's Chief Technology Officer) or other insiders. The claim is that XRP needs a massive valuation to serve as the liquidity layer for global banking.
The math here falls apart under scrutiny.
XRP's current circulating supply is approximately 100 billion tokens (with another 50 billion or so held by Ripple in escrow). If XRP reached $10,000 per token, the market capitalization would be approximately $1 quadrillion.
To put this in perspective:
Global GDP: ~$105 trillion
Total global wealth (all assets): ~$450 trillion
All stocks, bonds, real estate, commodities, and cash combined: ~$1.4 quadrillion
The claim that XRP needs a market cap equal to literally everything humanity owns requires explanation. The usual justification involves "market cap multipliers" and the idea that the same XRP tokens can be reused many times per day through high velocity.
This misunderstands how payment rails work. SWIFT moves approximately $5-7 trillion daily with zero market cap. Visa processes similar volumes with a market cap around $500 billion. Payment systems don't require 1:1 backing of transaction volume. They require sufficient liquidity and velocity.
If XRP needs a quadrillion-dollar market cap to function as a payment rail, the model is fundamentally broken. If it doesn't need that valuation to function, then the $10,000 price target is baseless speculation, not analysis.
The Volatility Paradox
There's a deeper logical problem at the heart of the XRP investment thesis. Retail investors are told two contradictory things:
XRP has escrow mechanisms and institutional design to maintain price stability for banking use
XRP will appreciate dramatically, potentially to $10,000 or beyond
These cannot both be true.
If XRP is designed for price stability to facilitate banking settlements, it should stay relatively stable—perhaps appreciating slowly with adoption but without dramatic volatility. This would make it useful for banks but unrewarding for retail investors hoping for life-changing gains.
If XRP appreciates 400,000% from $2.50 to $10,000, it exhibits extreme volatility. This makes it useless for the settlement use case because banks cannot tolerate that kind of price instability in their payment rails.
You cannot have a payment settlement asset that is both stable enough for institutional use and volatile enough to generate massive speculative returns. The use case and the investment thesis are incompatible.
The Ripple Dump
Here's an uncomfortable reality: Ripple holds approximately 50 billion XRP in escrow, released on a monthly schedule. They sell hundreds of millions of dollars worth of XRP regularly to fund operations.
This is documented in Ripple's quarterly reports. They're not hiding it. It's part of their business model.
Think about what this means. Ripple, the company that supposedly believes XRP will become the global banking settlement layer, is constantly selling their holdings. Every month, newly released XRP enters the market and is sold, primarily to retail buyers.
If Ripple truly believed XRP was going to $10,000, would they sell at $2.50? Or would they hold, knowing the asset in their treasury would appreciate 4,000x?
The fact that they continuously sell XRP rather than accumulating it tells you something about their actual expectations for price appreciation.
Where Does XRP Fit?
So we return to the fundamental question: in a world where Ripple is successful, where does XRP fit?
It's not the payment rail—stablecoins are better suited for that (price stability, regulatory clarity, actual adoption).
It's not a store of value—Bitcoin has proven itself there with genuine scarcity (21 million cap) and institutional adoption.
It's not a smart contract platform—Ethereum and its competitors own that space.
It's not necessary for RippleNet—most partnerships use the messaging layer without XRP.
What's left? Speculation. Retail investors buying XRP in hopes that future developments will create a use case that leads to price appreciation. This isn't an investment thesis—it's hopium.
Part 4: The Incentive Structure
To understand why XRP might not follow Ripple's success, you need to understand the incentive structure Ripple has created. It's actually quite brilliant—if you're Ripple. It's less brilliant if you're a retail XRP holder.
The Two-Asset Structure
Ripple has created a two-tier value capture system:
Tier 1: Ripple Equity (insiders only)
Ownership stake in a company with actual revenue
Claims on profits from software sales to banks
Ownership of 50+ billion XRP that can be sold to retail
Valuation of ~$15 billion
Available only to VCs, insiders, and early investors
Tier 2: XRP Tokens (retail accessible)
No claim on Ripple's business revenue
No ownership stake in the company
Dependent on bank adoption that mostly isn't happening
Price dependent on retail speculation
What Ripple is selling to fund operations
Notice the structure. Insiders capture the value from Ripple's business success through equity ownership. Retail investors are offered tokens that the company is actively selling.
The Perfect Business Model
From Ripple's perspective, this structure is perfect.
Revenue Stream 1: Enterprise Software Banks pay for RippleNet. This is recurring, predictable revenue from creditworthy institutions. This is the core business.
Revenue Stream 2: XRP Sales Retail speculation creates demand for XRP. Ripple sells from their treasury to fund operations and provide liquidity to insiders. This is essentially free money—selling tokens they created to enthusiastic buyers.
Asset Protection: Keep Equity Private By staying private, Ripple ensures that the truly valuable asset (equity in a profitable software company) stays with insiders. Retail cannot dilute this ownership.
If banks adopt XRP for settlement (unlikely but theoretically possible), Ripple wins enormous. Their XRP holdings appreciate massively, and they control a critical piece of financial infrastructure.
If banks don't adopt XRP but continue paying for RippleNet (the current reality), Ripple still wins. They have software revenue and have been selling XRP to retail for years.
If nothing works out, Ripple's equity holders still captured value from software revenue and XRP sales during the run.
Ripple wins in almost every scenario. XRP holders only win in one specific scenario that shows limited signs of materializing.
The Tether Comparison
Compare Ripple's structure to Tether's upcoming IPO. Tether has built a massively profitable business issuing USDT, a stablecoin backed by reserves. They make money on the spread between what they hold in reserves and what they pay in yield.
When Tether goes public, retail investors will be able to buy equity in this profitable business. They'll have a claim on actual revenue and profits. They can also hold USDT if they want exposure to the stablecoin itself.
Ripple could do this. They could go public and let retail invest in the company that benefits from RippleNet adoption and holds massive XRP reserves. They choose not to. Instead, they keep the valuable asset (equity) private and sell tokens to retail.
This should tell you something about where Ripple thinks the value lies.
Part 5: The Retail Reality
The final piece of this analysis is understanding who's actually buying and holding XRP. The answer is: almost entirely retail investors.
The Absence of Institutional Holdings
If institutional adoption of XRP for settlement was real or imminent, we'd see evidence:
SEC filings (13-Fs) showing institutional asset managers holding XRP
Public companies adding XRP to their treasuries (like MicroStrategy with Bitcoin)
Dedicated XRP ETF filings and approvals
Custody solutions from major providers like Fidelity and BlackRock
Nation-state adoption or central bank holdings
We see all of this for Bitcoin. We see none of it for XRP.
What we see instead is retail investors on Twitter, Reddit, and YouTube creating elaborate narratives about "secret institutional accumulation" based on no concrete evidence. The absence of institutional investment in XRP is glaring.
The Echo Chamber Effect
The XRP community has developed into something resembling a cult of believers. This isn't meant pejoratively—it's an observable phenomenon documented in behavioral finance research. Communities form around speculative assets and develop shared narratives that reinforce belief regardless of contradicting evidence.
Key characteristics of the XRP community:
Special Knowledge Claims: Believers claim to have insight into institutional adoption that the broader market doesn't recognize. They cite partnerships, technical specifications, and insider hints as evidence of impending mainstream adoption.
Reframing Negative News: Every setback becomes a positive. The SEC lawsuit was "clearing the way for institutional adoption." Price stagnation is "accumulation." The lack of bank adoption is "institutional players accumulating secretly."
Persecution Narrative: Skeptics are "FUD spreaders" who "don't understand the technology." Anyone questioning the XRP thesis is attacked rather than engaged with substantively.
Prophecy Mentality: There's always a catalyst coming. A pending announcement, a regulatory change, a partnership reveal—something that will trigger the long-awaited price explosion.
This psychological pattern is well-documented in speculative bubbles throughout history. It's what keeps believers holding through years of disappointing price action.
The Sunk Cost Problem
Many XRP holders bought near the 2018 peak around $3.80. They've now held through nearly eight years of XRP failing to return to that level, let alone exceed it. They've averaged down, buying more as the price declined. They've invested significant time learning about Ripple, following news, and participating in the community.
At this point, admitting that the investment thesis is flawed means acknowledging years of mistake. The psychological cost is enormous. It's often easier to continue believing than to face this reality.
This is the sunk cost fallacy in action.
