 |
| By Beth Canova |
It's been a big week for Ripple.
In just three days, the crypto company won approval for a U.S. trust bank, earned a strong credit rating for its stablecoin and announced new deals with two major trading platforms.
That's a lot of good news.
And if you own XRP (XRP), Ripple's native crypto token, you might expect its price to soar.
But there's a catch.
What's good for Ripple isn't always good for XRP.
To see why, let's look at what's changed.
Ripple Gets the Green Light from Washington
On Monday, Ripple announced that the Office of the Comptroller of the Currency had given final approval for its new national trust bank.
That's a big step.
It means Ripple can bring more of its crypto business under federal banking oversight. But this isn't a bank where you can open a checking account or take out a mortgage.
Instead, it will help manage the money backing Ripple's stablecoin, Ripple USD (RLUSD), and hold digital assets for large clients.
That matters because big banks and investment firms want clear rules before putting serious money into crypto.
And Ripple just cleared a major hurdle.
A Stablecoin Gets Wall Street's Seal of Approval
The next win came while most of us were still asleep this morning.
That’s when Moody’s gave RLUSD an A2 long-term rating and a P-1 short-term rating. Both are investment grade. And P-1 is Moody's highest short-term rating.
Why does that matter?
Because the strong ratings could make RLUSD more appealing to large financial firms. Of course, a good rating doesn't mean there's no risk. But it does give banks and other big players one more reason to take Ripple seriously.
And RLUSD has already grown to roughly $2.5 billion in market value since its launch in December 2024.
Coinbase and Robinhood Join the Party
Ripple is also expanding its exposure to retail investors, as well. Both ones coming from TradFi and those already on the blockchain.
On Tuesday, it announced a new deal with Robinhood (HOOD).
RLUSD is already live on Robinhood Chain and Bitstamp by Robinhood. It's expected to reach the main Robinhood app later this year. Now, Robinhood also plans to use Ripple's tools to help manage its own cash and payments.
Related Story: Robinhood’s New Blockchain Is Already Creating Crypto Winners
And today, Ripple announced a deal with Coinbase (COIN), as well.
Customers can now access RLUSD through Coinbase's retail and institutional platforms. The deal also supports RLUSD across the XRP Ledger, Ethereum (ETH) and Base networks.
That's important.
The more places people can use RLUSD, the more useful it becomes. And that could help Ripple compete in the fast-growing stablecoin market.
But What Does XRP Get Out of All This?
This is the key that every potential investor needs to understand …
Ripple is a company. It’s responsible for the XRP crypto asset. And the RLUSD stablecoin.
They're connected, but they're not the same thing.
Related Story: Crypto Discovered the Buyback. Here’s How to Read One
For example, RLUSD can move across the XRP Ledger.
Each transaction on that network requires a small fee paid in XRP. Accounts also need to hold some XRP as a reserve.
So, more activity could mean more demand for XRP.
But there's a limit to that benefit. RLUSD isn’t restricted to the XRP blockchain. As I said above, it can also move across the Ethereum and Base networks, where XRP isn't needed. Fees on those chains are paid in ETH.
And even on the XRP Ledger, people can send RLUSD without first buying an equal amount of XRP.
That means a tenfold rise in RLUSD use wouldn't mean a tenfold rise in XRP demand.
There's another key point.
Owning XRP doesn't give you shares in Ripple or a claim on its profits.
So, even if Ripple's business grows, XRP holders don't get a direct cut.
What XRP Investors Should Watch Next
None of this means Ripple's big week is bad news for XRP.
Far from it.
More banks, trading platforms and payment firms using Ripple's tools could help bring new users to the XRP Ledger.
And if more firms use XRP to move money between currencies, demand for the token could grow.
But that's the key word: if.
Related Story: How to Find the Strongest Tokens in Crypto
Three data points will help you see whether XRP is benefitting from Ripple’s growth …
- How much activity moves onto the XRP Ledger,
- Whether XRP use grows in cross-border payments
- And how much RLUSD activity takes place on other networks.
Because Ripple has just shown it can build a bigger business.
Now, XRP needs to show it can share in that growth.
Best,
Beth Canova
