After performing well for most of July, XRP (XRP 7.14%) has hit a speed bump. The price is down about 12% over the last seven days at the time of this writing (July 29).

This isn't exactly an opportunity to buy the dip, considering XRP is still up 52% on the year and not too far off its recent highs. But you might still want to consider picking up some XRP tokens right now, because there's a big potential growth catalyst on the horizon.

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The SEC may approve XRP ETFs this year

The Securities and Exchange Commission (SEC) approved the first spot-crypto exchange-traded funds (ETFs) last year, starting with Bitcoin (CRYPTO: BTC) ETFs in January. It approved Ethereum (CRYPTO: ETH) ETFs in July 2024. Bitcoin and Ethereum are the two largest cryptocurrencies by market cap. After its recent success, XRP is third, and several asset managers have filed for XRP ETFs with the SEC.

The applications are currently under review, but the consensus is that it's only a matter of time. Polymarket currently puts the approval odds at 86% for a spot XRP ETF in 2025.

ETF approval would make it easier to invest in XRP, increase liquidity, and would also likely attract more institutional investors. That's been the case with Bitcoin and Ethereum. Bitcoin ETFs have seen inflows of $55 billion since approval, and Ethereum ETFs have had inflows of over $9 billion.

Despite its recent success, XRP still hasn't topped its all-time high of $3.84 from January 2018. If the SEC approves XRP ETFs this year, it could be just what the cryptocurrency needs to surpass that and potentially break the $4 mark.

XRP could be a long-term winner

XRP has been one of the best cryptocurrency investments recently, and its use in international payments gives it real-world value. If you've been thinking about investing, consider doing so before a decision is made on XRP ETFs.