Ripple is investing heavily in building an ecosystem around RLUSD, XRP’s stablecoin counterpart.
After nearly five years, the legal saga between XRP (CRYPTO: XRP) and the U.S. Securities and Exchange Commission (SEC) has come to a close. Dating back to December 2020, Ripple and the SEC disputed whether XRP was an unregistered security until a federal judge ultimately ruled that it was not in retail transactions. Both sides agreed to end their appeals as they pertain to XRP. In a joint filing with the U.S. Court of Appeals recently, both parties withdrew their court appeals, and Ripple agreed to pay $125 million in fines.
For Ripple, this marks a long-awaited closure. The company can disperse XRP without worrying about the SEC breathing down its neck. For investors, there’s less risk of trading platforms delisting or suspending XRP, which many did in January 2021 following the initial SEC lawsuit. But does this mean the token is set for a price surge?
Coincidentally, U.S. President Donald Trump signed an executive order on Aug. 7, the same day as Ripple and the SEC’s joint filing, allowing cryptocurrencies to be included in 401(k) retirement accounts. XRP’s price jumped by 11% to $3.32, outpacing both Bitcoin and Ethereum that day.
It was XRP’s biggest single-day gain since July 17, when the coin surged roughly 14% after House lawmakers advanced the Genius Act, a bill aimed at regulating stablecoins and integrating them into everyday finance. While XRP isn’t a stablecoin, Ripple’s own USD-pegged RLUSD coin helped fuel optimism within the Ripple ecosystem. When the bill’s approval was announced, Ripple CEO Brad Garlinghouse showed his support on social media platform X, stating that the Trump administration was the most “crypto forward” in U.S. history.
After four straight days of losses, XRP bounced back on Aug. 12 with a roughly 4% gain. And while it has pulled back since reaching a record high of $3.66 in early July, that kind of retracement is common for volatile assets.
The bullish day can be linked to the 90-day extension of the U.S.-China tariff freeze. The crypto market has often reacted to tariff news, including a sharp sell-off when “Liberation Day” tariffs were announced in early April. The uncertainty around tariff policy tends to amplify the instability and volatility of XRP.
The coin is struggling against resistance between $3.40 and $3.50 and may need significant news to break and hold above that range. Until then, it doesn’t seem that a surge is coming soon.
Floating at around $3.25 as I write this, XRP looks a bit overbought. If investors are willing to wait for at least a 10% retracement, there is promise for a good purchase. The court case is now in the rearview mirror, and Ripple is investing more into the stablecoin space by purchasing the stablecoin payment platform Rail. And if adoption for RLUSD rises over time, it could create even more demand for XRP.
Financial institutions have already started incorporating XRP and/or Ripple’s high-speed Ripple Ledger blockchain for cross-border payments. Some of the bigger names include American Express, MoneyGram, and PNC Financial Services. It appears that the coin is here to stay for the long term and will likely develop an even larger role in the American financial system as the country becomes more crypto-friendly. That all being said, the crypto market is unregulated and will remain much more volatile than traditional assets. Investors should invest only money they can afford to lose.
But in the short term, investors should wait to purchase the coin and be aware of how international tariffs play out, as these extended freezes can only last for so long.
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 $650,499!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,072,543!*
Now, it’s worth noting Stock Advisor’s total average return is 1,045% — a market-crushing outperformance compared to 182% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
Adé Hennis has positions in XRP. American Express is an advertising partner of Motley Fool Money. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and XRP. The Motley Fool has a disclosure policy.
Read more on NASDAQ Stock Market
