Despite benefiting from high-profile developments such as a favorable resolution to its multi-year SEC lawsuit, XRP has struggled to maintain momentum this year. Currently trading around $2, XRP has fallen roughly 41% from its annual peak, retreating in market capitalization from a high of $190 billion to approximately $118 billion.
Nonetheless, recent market movements have significantly narrowed the valuation gap between XRP and Ethereum, sparking speculation that XRP could soon surpass Ether in market capitalization. Ethereum has experienced its own struggles, declining by over 61% year-to-date and facing the possibility of breaching the critical $1,000 price level. As a result, the current market cap difference between XRP and Ethereum has shrunk to around $45 billion, and several emerging factors suggest XRP might be poised to make a decisive move upward over the coming months.
A key driver behind optimism for XRP is robust growth in its underlying XRP Ledger network, a decentralized, open-source blockchain platform known for fast throughput, low fees, and efficient transaction settlement. Recently, Ripple Labs completed a $1.25 billion acquisition of prime broker Hidden Road, which processes over $10 billion in daily transactional volume. The expectation is that Ripple will shift Hidden Road’s extensive institutional transaction infrastructure to the XRP Ledger, significantly boosting the blockchain’s transaction activity and visibility.
Adding further bullish sentiment, Ripple CEO Brad Garlinghouse has outlined an ambitious goal to directly challenge SWIFT, the international banking network which handles over $150 trillion in transaction volume annually. Garlinghouse has consistently emphasized XRP Ledger’s competitive advantage in settlement speed, cost efficiency, and reliability compared to traditional methods. With Ripple’s regulatory challenges largely behind it, successfully positioning XRP Ledger as a viable SWIFT alternative could propel the cryptocurrency to new highs.
In stark contrast, Ethereum faces increasing skepticism amid stagnating activity on its primary layer-1 network, overshadowed by numerous competing layer-2 scaling solutions. The Ethereum ecosystem’s ongoing complexity and heightened competition may drag further on Ether prices, widening XRP’s opportunity for significant gains.
Another critical catalyst for XRP is the potential approval by the U.S. Securities and Exchange Commission (SEC) of an XRP-based Exchange-Traded Fund (ETF). Market prediction pools currently indicate around 76% likelihood of SEC approval, reflecting positive expectations among traders and investors. Analysts from JPMorgan estimate that a successful XRP ETF could attract institutional inflows reaching $8 billion within its initial year, materially elevating XRP’s price trajectory. Conversely, Ethereum ETFs, despite being already approved, have accumulated only around $2.6 billion in total inflows and have been experiencing recent withdrawals.
From a technical viewpoint, XRP shows supportive indicators suggesting price stabilization and possible upside momentum. On the weekly chart, XRP has retraced and is testing the $2 support level, aligning with the upper boundary of a bullish “cup and handle” pattern, a highly regarded continuation pattern often signaling upward price moves. Furthermore, XRP maintains strong positions above its 50-week and 100-week moving averages, indicating solid price consolidation. Should XRP regain bullish momentum, it will initially target testing its previous yearly high of around $3.40. Analysts project further potential price objectives of approximately $3.70, as indicated by the cup and handle breakout pattern projection, with a longer-term possibility of touching the widely anticipated $5 mark.
In comparison, Ethereum finds itself currently weighted by bearish technical setups, including recent formation of bearish “triple-top” and “death cross” patterns, predictive of continued downward pressure.
Together, these favorable developments—from network enhancements and strategic acquisitions to potential ETF approvals and technical chart formations—support the growing sentiment that XRP could realistically surpass Ethereum’s market valuation over the medium term, marking a significant shift in the crypto market landscape.
