The Oct. 10 flash crash clarified a lot about crypto, and the picture it painted for XRP (XRP 3.27%) and Ripple's U.S. dollar stablecoin, RLUSD (RLUSD 0.09%), could be more encouraging than the headlines suggest. XRP lost 15% of its value between Oct. 10 and Oct. 11, and it's down more than 25% during the past month.
So is this a situation where investors should be buying the dip like wild, or sweating about what to do if there's another big leg downward to come?
What broke, what didn't, and why it matters
On Oct. 10, the crypto market suffered record liquidations after surprise tariff headlines, with most major cryptos and many altcoins sliding sharply before stabilizing. During that panic, a handful of things went wrong, including price data sources going haywire on critical crypto exchanges, stablecoins losing their pegs to their underlying fiat currency, and market makers refusing to buy, causing the sell-off to steepen even more. Some smaller blockchains even temporarily collapsed under the load of volume amid the volatility.
Now contrast that with the performance of XRP, its XRPL ledger, and its native stablecoin, RLUSD.
Price feed data shows that RLUSD traded essentially perfectly at $1 throughout the flash crash and through the rest of the week, which is exactly what you want from the core tool for payments and transfers on the chain. And because XRP's decentralized exchanges (DEXes) are still very small compared with the giant decentralized finance (DeFi) venues elsewhere, there was little contagion across the XRPL token ecosystem.
In other words, most of the weekend's fire didn't have much to burn on XRPL, in stark contrast to pretty much everywhere else in the sector. That insulated it from the kinds of cascades that hit some other platforms.
Could some institutional investors who also hold XRP have suffered losses in other corners of crypto? Yes, but even if a handful did, that is not the same as damage to XRP's long-term value drivers. The technology held up, and RLUSD did its job the same as always. If anything, the flash crash showed that the XRPL can remain steady even in a powerful storm.
There's still ample reason to buy this coin
The investment thesis for buying XRP has always been about its institutional utility.
It offers predictable performance and features that satisfy know-your-customer (KYC) and asset-control requirements without needing to add third-party tools with questionable smart contracts. Its features are carefully designed for the financial institutions like banks and currency exchange houses that it wants to attract to its network. Nothing about the crash or the coin's now-lower price changes anything about how valuable those offerings were and are.
Assuming the economic environment doesn't deteriorate and the crash's drama fades into the background, XRP's institutional adoption should continue. That does not mean XRP is risk-free. But it does mean that much of the risk facing investors with this asset right now is linked to external economic factors rather than to Ripple's execution of its development plans.
Thus, pragmatically, this flash crash looks like a classic opportunity to add to an XRP position and get it slightly cheaper than before, with the idea being that a long-term hold will pay off as it becomes a mainstream financial tool.
There's no overwhelming reason to worry here, though the economic backdrop does suggest that buying it hand over fist might be a touch too much enthusiasm at the moment; more conservatively sized purchases are what's in order, at least until the big picture becomes slightly less uncertain. If the crypto can keep demonstrating that it has real value and that customers want to use it to manage their finances, then its odds of future success are more likely than the noisy Oct. 10 crash suggested.
