For more than a century, no asset class has held a candle to the average annual return delivered by stocks. But when the lens is narrowed to the last decade, cryptocurrencies have left Wall Street’s benchmark index, the S&P 500 (SNPINDEX: ^GSPC), in their dust.
Although the world’s largest digital currency, Bitcoin, has led the charge higher, some of the most popular altcoins have actually performed better over the trailing year. This includes the Ripple payment network’s bridge currency, XRP (CRYPTO: XRP), which has rallied 34% over the trailing year (as of the early evening on Nov. 23), while Bitcoin has retraced by 14% over the same time frame.
Digital currency investors are always on the lookout for the next big thing in the cryptocurrency arena, with many latching onto high-profile blockchain and payment projects. While XRP hasn’t been short of catalysts in 2025, several headwinds suggest it’ll drop to $1 next year.
XRP has been on fire, and it’s not hard to understand why
XRP’s marked outperformance over the trailing year, relative to Bitcoin, boils down to five factors.
Arguably, the most important boost for XRP came in November, when President Donald Trump was elected to his second term. Compared to Democratic Party presidential nominee Kamala Harris, Trump was viewed as the more favorable candidate toward crypto. Bitcoin and most altcoins rallied following the president’s November victory.
The second catalyst, which builds on the previous point, is the long-awaited resolution to litigation between the U.S. government and Ripple. Both parties agreed to drop their appeals following a 2023 split ruling that found some sales of XRP to institutional investors violated securities laws, but sales of XRP on public exchanges did not. The removal of this legal overhang ends years of uncertainty for XRP.
The rise of XRP has also been fueled by the approval of spot XRP exchange-traded funds (ETFs). These are ETFs that hold XRP tokens, providing investors with an easy way to gain exposure to and closely mirror the performance of the bridge currency of Ripple’s payment network.
The fourth factor pushing XRP higher in 2025 is the growing utility of RippleNet, Ripple’s payment network. More than 300 financial institutions around the globe are estimated to be using RippleNet, with some of these institutions relying on XRP as a bridge currency for cross-border transactions. The XRP Ledger can validate and settle transactions in roughly three to five seconds, with the cost of each transaction coming in at just fractions of a penny.
