Bitcoin (BTC +1.67%), the world's largest cryptocurrency, surged after the presidential election win by Donald Trump in November 2024, largely on the belief that Trump would implement favorable regulations for the crypto sector. Trump delivered, but Bitcoin still ended the year in the red. The token appears to have pulled back due to several factors, including concerns about the macroeconomic environment and the trajectory of interest rates.
Additionally, there seemed to be a good amount of profit-taking or selling by Bitcoin whales with large holdings. Given some of these concerns, should investors forget Bitcoin and buy XRP (XRP +3.12%) instead?
Bitcoin vs. XRP
Not only is Bitcoin the pioneer of the crypto sector, but at times in 2025, it seemed to prosper while the rest of the sector struggled. Part of this is due to the belief that Bitcoin is a form of digital gold, and therefore a hedge against inflation and currency debasement.
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Bitcoin will only ever have 21 million coins, and most of those have already been mined and are in circulation. Because of this, investors view Bitcoin as a finite resource, similar to gold, which has seen its price surge due to concerns surrounding U.S. dollar debasement. With U.S. debt now exceeding $38 trillion, and interest payments on the debt one of the largest line items in the annual U.S. budget, investors are concerned the dollar will lose value.
Now, U.S. debt concerns have been around for quite some time, but it may perhaps be reaching a tipping point. Debt can become a never-ending cycle. Since the Great Recession, the Federal Reserve has flooded the economy with money, which has inflated asset prices. All of this suggests that more inflation could arrive in the future and that the dollar will only lose value, making assets like gold and Bitcoin safe havens.
XRP is the fifth-largest cryptocurrency and also one of the earlier coins to emerge. It runs on a superior blockchain network that is less decentralized than Bitcoin but can process many more transactions per second, making it ideal for international payment transfers.
CRYPTO: BTC
Key Data Points
Ripple, the company behind XRP, leverages the coin and its network to provide payment solutions to traditional players in the mainstream financial industry.
Ripple can help banks send instant payment transfers globally, letting the senders easily move in and out of different currencies with the help of stablecoins. Furthermore, Ripple's solutions provide financial institutions with on-demand liquidity, eliminating the need to pre-fund foreign accounts. Ripple also runs a large multi-asset prime brokerage that provides institutional traders with access to traditional assets and cryptocurrencies.
XRP is not the only strong technical network in the crypto sector, so there is competition. The question is whether the coin, network, and Ripple ecosystem can gain enough traction to become a major player in facilitating international payments.
Should you buy XRP over Bitcoin?
I wouldn't call Bitcoin's digital gold narrative totally proven out yet because on many occasions, Bitcoin has simply traded like a volatile tech stock in the Nasdaq. However, I do think it could ultimately serve as a unique diversifier in one's portfolio. Additionally, as institutional adoption of crypto continues, I believe the obvious starting point for most institutional investors is Bitcoin.
Therefore, if I had to choose, I would continue to hold Bitcoin over XRP. However, that doesn't mean I am opposed to owning XRP. The coin and its network have immense potential to become a big player in international payments. However, like most cryptocurrencies, XRP remains inherently volatile and continues to move in line with the broader sector.
For this reason, I would still keep XRP positions smaller and more speculative, while recommending that Bitcoin still be an investor's largest crypto position.
