XRP (XRP +3.48%) is one of just a few cryptocurrencies with a legitimate use case in the real world. It was created by a company called Ripple, which developed a payments network that lets banks send money around the world practically instantly, and with minimal costs.
Ripple had a positive year in 2025. The company reached a settlement with the Securities and Exchange Commission (SEC), which officially ended a brutal five-year legal battle over compliance issues. Plus, the first spot XRP exchange-traded funds (ETFs) were approved for trading in the U.S., which created a new source of demand for the token.
As a result, XRP soared to a seven year high in July for the first time in seven years. However, the token quickly lost momentum and has since declined by more than 40%. It faces some structural issues that might be difficult to overcome, and if history is any indication, more downside could be ahead. Here's where I predict the token will be trading five years from now.
Image source: Getty Images.
Ripple could transform the traditional banking system
Not every bank uses the same payment infrastructure. While many use the popular Society for Worldwide Interbank Financial Telecommunication (SWIFT) network, others don't, which means those banks have to use intermediaries to settle transactions with one another. This can add days and significant costs to every transfer.
Ripple Payments is designed to facilitate direct communication between financial institutions. That means two banks in different countries can settle transfers directly and instantly, eliminating the need for intermediaries and reducing costs.
Ripple created XRP to standardize each transaction. Instead of a French bank sending euros to a South Korean bank, it can send XRP instead, which cuts out costly foreign exchange fees. The transfer would cost around 0.00001 XRP tokens, which is a fraction of one U.S. cent.
Unlike many mainstream cryptocurrencies that are obtained through a process called mining, XRP is issued directly by Ripple. In 2020, the SEC took issue with this arrangement and sued the company, arguing that XRP should be classified as a financial security like any other instrument issued by corporate entities. (Shares and bonds are two good examples.)
The case threatened to derail Ripple's business model, which suppressed the price of XRP for several years. Fortunately, the SEC agreed to a settlement last year in line with President Donald Trump's pro-crypto agenda, which propelled XRP to a seven-year high of $3.65. But as I mentioned earlier, its momentum is already fading.
Where XRP might be trading in five years
XRP recently traded at about $2.08, more than 40% lower that last year's peak. The token lost more than 90% of its value after it set its record high of $3.84 in 2018, and I think a decline of that magnitude might be under way right now.
CRYPTO: XRP
Key Data Points
Although XRP is an important part of Ripple Payments, banks don't have to use it to benefit from instant cross-border transfers, because the network also supports fiat currencies. That means even if Ripple Payments becomes the preferred payment solution by banks all over the world, it won't necessarily increase the value of XRP.
Plus, bridge currencies like XRP won't always increase in value even if they are used frequently. If a bank makes a payment using 1,000 XRP, the receiving bank will typically convert those 1,000 tokens into their domestic currency almost immediately so they can carry on with their business. In other words, there is always a constant supply of sellers, which limits the token's potential upside.
Finally, Ripple launched its own stablecoin, called Ripple USD (RLUSD +0.02%), in 2024, which is better suited for payments because it offers zero volatility. Users still have to pay fees in XRP when they use Ripple USD because the stablecoin is built on the XRP ledger, so it creates some demand for the coin -- but not enough to move the needle long term.
In summary, in five years from now I think XRP could be trading as much as 90% lower than its recent high, which would translate to a price of $0.36.
