What is the cryptocurrency XRP? Its relationship with Ripple and its future prospects explained

The cryptocurrency market continues to grow day by day, centered around Bitcoin (BTC) and Ethereum (ETH). Among them, one cryptocurrency that has been experiencing stable growth due to actual demand is XRP, a cryptocurrency issued by the US company Ripple Inc.

This article provides a detailed explanation of Ripple's business activities, the characteristics and future potential of XRP, and future prospects.

Ripple Overview and Vision

Ripple Overview and Vision

RippleNet（リップルネット）とは？

RippleNet is a global payment network for enterprises built by Ripple, which directly connects banks and payment providers around the world on the blockchain. This enables instant and transparent transactions without intermediaries, even when transferring money between different countries and currencies.

RippleNet has been redesigned as a simpler and more comprehensive payment platform by integrating the previous individual products (xCurrent, xRapid, xVia). Currently, RippleNet is mainly composed of the following two core functions:

• RippleNet Messaging (formerly equivalent to xCurrent)

A payment messaging function that complies with the ISO 20022 standard. It allows banks and remittance companies to exchange remittance information in real time, improving tracking of remittance status and transparency.

This competes with the traditional SWIFT messaging and has already been adopted by many financial institutions.

• ODL（On-Demand Liquidity）

A liquidity provision function that uses XRP as a bridge currency to realize instant conversion and settlement between currencies. By converting the sender's currency into XRP and then converting it back into another currency on the receiving side, there is no need to hold a nostro account.

As of 2025, ODL is in operation in more than a dozen countries, and its practical application is progressing mainly in Southeast Asia, the Middle East, and Latin America.

Of these, ODL (on-demand liquidity) is attracting particular attention. It is revolutionary in that it instantly converts fiat currency into XRP and then converts it back into another fiat currency in the receiving country, eliminating the need for an intermediary account (nostro account) while achieving both liquidity and speed.

With this structure, RippleNet will serve as the next-generation international remittance infrastructure to replace the existing SWIFT system, enabling real-time payments across multiple regions, currencies, and financial institutions.

Partnership with banks

One of the reasons Ripple is attracting attention is that it has built strong partnerships with major banks and financial institutions around the world. This not only shows the reliability of the technology, but also the influence of Ripple in the financial industry.

Partner companies include major companies with global operations, such as Japanese megabanks such as Mitsubishi UFJ Bank and SBI Holdings, as well as Santander Bank in Europe and American Express in the United States.

By adopting RippleNet, these companies have benefited from shorter remittance times, reduced operational costs, and improved transparency in payments, and it is expected that the number of institutions adopting it will increase in the future.

Some of the adoption cases

Japan: SBI Ripple Asia, a joint venture with the SBI Group

Europe: Santander Bank introduces a remittance app using RippleNet

Centralized Structure and Its Evaluation

While crypto assets (virtual currencies) such as Bitcoin and Ethereum are characterized by their "decentralized" network structure, Ripple has deliberately adopted a centralized approach. This policy has been met with mixed opinions within the industry.

Being centralized means that Ripple has strong control over network operations, technology development, and the holding and distribution of XRP. While this structure is likely to gain the trust of the financial industry and regulatory authorities, it has also been criticized by the cryptocurrency community, which places importance on decentralization, as being "against the principles of true blockchain."

However, this approach is said to have benefits such as quick decision-making, regulatory compliance, and scalability, especially in financial applications, and has received a certain amount of praise from the perspective of focusing on practicality.

Fundamental Properties of XRP

XRP is a crypto asset (virtual currency) developed and issued by Ripple, and serves as a "bridge currency" to facilitate international remittances on RippleNet.

The greatest features of XRP are its speed, cost, scalability, and reliability. In transaction processing based on blockchain technology, it has superior performance compared to other major crypto assets (virtual currencies), and is positioned as a currency with extremely high practicality.

Main features 

• Transaction speed: Remittances are completed in about 3 to 5 seconds, significantly faster than Bitcoin (around 10 minutes) and Ethereum (several minutes).
• Remittance fees: The fee for sending XRP is extremely low at 0.00001 XRP (1 XRP = a very small amount calculated using a few tens of yen).
• Total issuance and scarcity: The issuance limit is fixed at 100 billion XRP, so inflation risk is low. In addition, XRP is burned as a fee when sending, so the amount in circulation is designed to gradually decrease.

XRP is also recognized for its extremely low energy consumption, using a unique distributed ledger technology called the XRP Ledger. This is because it uses a different consensus algorithm, "PoC (Proof of Consensus)," than Bitcoin's PoW (Proof of Work).

Transaction Performance and Cost

The biggest point that clearly differentiates XRP from other cryptocurrencies is its high remittance speed and low fees.

Bitcoin takes about 10 minutes to generate a block, and when transactions are congested, it can take several hours. Ethereum also tends to have high network gas fees, making it unsuitable for small remittances.

In contrast, XRP has the ability to complete payments in a few seconds, almost zero remittance costs, and process more than 1,500 transactions per second, achieving both scalability and stability. This means that it is suitable not only for payments between companies and large remittances by financial institutions, but also for small international remittances (retail remittances).

In addition, XRP transactions have a very low risk of "failure" and the time required for confirmation is almost instantaneous, making it highly practical for business use.

ODL (On-Demand Liquidity)

ODL (On-Demand Liquidity), a core feature of RippleNet, is an innovative mechanism that enables real-time currency conversion and remittance processing using XRP.

Conventional international remittances required the sender and recipient to each hold a "nostro account" and pool the destination currency in advance. This was inefficient in terms of cost and also exposed them to the risk of exchange rate fluctuations.

With ODL, remittances are carried out as follows:

• Instantly convert the sending currency (e.g. Japanese Yen) to XRP
• XRP is sent to the receiving country within seconds
• Instantly convert to the currency required by the receiving country (e.g. Philippine Peso) and the money is delivered

This process not only eliminates the need for nostro accounts, but also enables instant settlement, low-cost, and highly transparent international remittances. As of 2025, ODL is already operating in over 40 countries, and is increasing its presence as a remittance infrastructure in emerging markets such as the Philippines, Mexico, and India.

In addition, Ripple is working with third-party market makers and cryptocurrency exchanges to strengthen liquidity supply in ODL and build a more stable remittance environment. This is making it easier for financial institutions to adopt ODL.

Current Price of XRP

Current price: 323.62 yen

As of June 4, 2025（CoinMarketCap "XRP Price, Chart, Market Cap"）

As of June 2025, XRP has been stable at around $2.00, and has shown a clear recovery trend since the SEC lawsuit was concluded in 2024. The market is evaluating the "elimination of legal risks" and "expansion of actual demand," and positive sentiment is growing compared to the previous uncertainty.

Factors driving future price increases

The main factors that could lead to a rise in XRP price in the future are as follows:

• Expanding adoption in the international remittance market

  Ripple's partner financial institutions are on the rise, and the use of ODL (on-demand liquidity) is also expanding. The advantages of remittance speed and fees are being recognized.

• Progress of CBDC-related projects

  CBDC pilot programs based on the XRP Ledger are underway in several countries, and collaboration with central banks bolsters investor confidence.

• Change in US government stance

  Following the conclusion of the lawsuit with the SEC, XRP has been listed again on major exchanges in the United States, and the stability of the regulatory environment is encouraging the inflow of investment funds.

• Hopes for ETF approval in the US

  In 2025, several asset management companies have submitted applications for XRP spot ETFs, and there is a growing view that XRP may also be approved, following the precedent of the Bitcoin spot ETF. If the ETF is approved, it is highly likely that the inflow of funds from institutional investors will accelerate, which will be a catalyst for pushing up the market value of XRP.

• Attention as a strategic cryptocurrency

  It has been reported that XRP will be included in the US "Strategic Crypto Assets (Virtual Currencies) List" in 2025, and expectations are growing that it will serve as a medium- to long-term value preserving asset.

Background to the SEC lawsuit

In December 2020, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Ripple and its executives, alleging that "XRP is an unregistered security and its sale violates securities laws."

The SEC took issue with Ripple's raising of approximately $1.3 billion through XRP, and deemed that the fact that Ripple "gave investors explanations that led them to expect future price increases" during the sales process constituted a securities transaction that constituted an investment contract.

Ripple's rebuttal and its impact on the market

Ripple strongly refuted the SEC's complaint, stating that "XRP is a decentralized currency and does not qualify as a security." They emphasized that, like Bitcoin (BTC) and Ethereum (ETH), there is no guarantee from a specific issuer, and criticized the SEC's view as incompatible with modern blockchain technology.

Ripple also protested that the SEC's decision to sue without providing clear rules or guidelines was an unfair measure that would cause confusion and instability in the market.

As a result of this lawsuit, XRP was temporarily delisted and suspended from trading on multiple cryptocurrency (virtual currency) exchanges in the United States, and its price fell significantly. Furthermore, the view that regulations could extend to other cryptocurrencies spread, resulting in increased vigilance over regulatory risks throughout the industry.

The outcome of the legal battle between Ripple and the SEC

The legal battle between Ripple and the SEC, which began at the end of 2020, is expected to come to an end as the SEC has indicated its intention to formally withdraw its appeal in March 2025. As a result, a final settlement has been reached between Ripple and the SEC, and the legal battle is about to come to an end with Ripple paying a $50 million fine.

This outcome is a major turning point for Ripple, and also marks the beginning of the next phase for the entire cryptocurrency industry, which will seek to balance regulation and growth.

Global market expansion strategy

Ripple is strengthening its presence in emerging markets with high demand for international remittances, such as Asia, the Middle East, and Latin America.

Notable Moves

• Expanding remittance partners in the Philippines
• Expanding RippleNet adoption in the United Arab Emirates

Involvement in CBDC (Central Bank Digital Currency)

Ripple is conducting CBDC pilot projects with several countries, particularly in partnership with the Kingdom of Bhutan, the Republic of Palau, and the government of Montenegro, to help build national digital infrastructure through blockchain technology.

With these positive factors as a backdrop, XRP is expected to have room to rise in the medium to long term, but on the other hand, market volatility and changes in regulatory policies must continue to be watched closely. In particular, XRP has experienced price crashes and market turmoil in the past due to lawsuits with the SEC, and it should not be forgotten that XRP is a stock whose relationship with regulators greatly influences investment decisions.

In addition, while the expansion of use cases such as international remittances and CBDCs is a factor that supports future growth, actual demand and price do not necessarily go hand in hand. It is also greatly influenced by market sentiment, the macroeconomic environment, and the trends of other crypto assets (virtual currencies), so a long-term perspective and risk management are essential.

As a basic premise, many crypto assets (virtual currencies), not just XRP, are highly volatile, so caution is required regarding sudden price fluctuations.

Ripple and XRP are not just cryptocurrency projects, but continue to evolve as a practical solution to international financial issues with next-generation technology. Its practicality is growing year by year, with the efficiency of cross-border remittances through RippleNet and ODL, technology provision for CBDC development, and the use of the highly energy-efficient XRP Ledger (XRPL).

As of 2025, Ripple is free from legal risks and is once again accelerating its business expansion in the United States and overseas. XRP is also regaining attention as an investment target, with use cases rooted in social needs such as international remittances, institutional finance, and environmental impact measures.

In addition, in the United States, developments such as the application for a spot ETF and inclusion on the list of strategic cryptocurrencies are expected to have a positive impact on future prices and market recognition.

While there are more and more positive factors for Ripple and XRP, cryptocurrencies are subject to drastic price fluctuations, so it is necessary to take risks into consideration when managing them.

Images: Shutterstock

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