In recent times, Ripple’s XRP has emerged as a focal point in discussions surrounding the US government’s strategic approach to cryptocurrencies. Specifically, President Donald Trump’s mention of XRP as a valued asset within the proposed Digital Asset Stockpile has sparked debate regarding the token’s utility and rightful place in this reserve.
The Digital Asset Stockpile, established by Trump’s executive order on March 6, aims to categorize several cryptocurrencies, including BTC, ETH, SOL, and ADA, under a framework managed by the Treasury. However, the crypto community is divided over whether XRP truly deserves a spot among these heavyweights.
Launched in 2012 by Ripple Labs, XRP Ledger (XRPL) was designed primarily for interbank settlements. Initially, it featured three enterprise solutions: xRapid, xCurrent, and xVia, which have since been rebranded under the RippleNet umbrella. Among these, xCurrent facilitates real-time messaging and settlement between banks, while xVia acts as a payment interface for financial institutions to execute transactions through RippleNet. Notably, only xRapid—now rebranded as On-Demand Liquidity (ODL)—actually requires the use of XRP, suggesting that the adoption of Ripple’s technology does not inherently drive XRP’s price.
Prominent banks including American Express, Bank of America, and Santander have utilized xCurrent and xVia, but the uptake of XRP-powered ODL remains less established, with known participants like SBI Remit in Japan and Tranglo in Southeast Asia.
Moreover, XRP’s usage extends to the Web3 space, serving as a gas token, though its function is considerably limited compared to Ethereum. While Ethereum’s transaction fees benefit validators, XRP fees are burned as an anti-spam mechanism, reflecting a different operational model.
The Web3 capabilities of the XRPL are relatively modest. Even with its introduction of native NFT support through the XLS-20 standard in 2022, XRPL’s overall DeFi market is still fledgling, with just $80 million locked in total value, significantly lagging behind leading smart contract platforms like Ethereum and Solana.
<pRipple Labs, through CEO Brad Garlinghouse, calls for equitable treatment among cryptocurrencies; however, the discussion on XRP's inclusion in the government Digital Asset Stockpile raises critical questions. As Garlinghouse articulated, the token should ideally represent industry diversity rather than a singular representation of value.
Despite advocacy for XRP, its functionality is often contrasted against Bitcoin’s perceived resilience as a geopolitically neutral asset. The concerns surrounding XRP’s utility stem largely from Ripple’s unique model, which relies on a trusted group of validators instead of traditional mining or staking mechanisms. This centralized form raises concerns over censorship and market manipulation, particularly given that approximately 55% of the 100 billion pre-mined tokens remain held by Ripple Labs.
This raises vital implications for XRP’s long-term sustainability and its market perception as it navigates its role within a rapidly evolving digital economy.
