Key Points

XRP's price has declined roughly 60% from its July 2025 high, despite major victories for Ripple.
Ripple's new stablecoin RLUSD provides institutional clients a way to skip XRP in cross-border payments.

Last year, Ripple, the firm behind XRP, resolved its extended legal dispute with regulators. Soon afterward, seven spot XRP exchange-traded funds, including the Canary XRP ETF, launched in the U.S. and drew over $1 billion in inflows rapidly.

These developments promised to drive XRP's value sharply higher - and they did, temporarily. Yet after hitting more than $3.50 in July, the token now sits at $1.40 - under its level prior to the lawsuit settlement and ETF debuts.

So what explains this trend? And what could lie ahead for those holding XRP?

The Bank Adoption Theory's Major Weakness

To make sense of the situation, examine the heart of the optimistic case for XRP. The premise holds that as banks and large financial entities embrace Ripple's solutions, XRP demand will surge and its price will climb. This view, however, misjudges the tools banks choose and their application.

Ripple traditionally delivers two core offerings: RippleNet for general connectivity and On-Demand Liquidity (ODL) for instant funding. Though rebranded recently, the differences persist. The table outlines the essentials.

RippleNet	ODL
Core function	Bank settlements	Cross-border payments
Main clients	Large banks	Fintech firms and remittance services
Share of total volume	Majority	Minority
XRP involvement	None	Optional

The vital insight, setting aside technical details, is that RippleNet - its leading service - generates zero direct demand for XRP, irrespective of wider bank uptake.

ODL, which can involve XRP, processes far less volume overall. Moreover, its influence on price remains far milder than enthusiasts expect.

Ripple's Stablecoin Compounds the Challenge

Compounding matters, Ripple launched a stablecoin positioned to supplant XRP in cross-border flows, diminishing ODL's potential boost to the token.

Named RLUSD, this stablecoin maintains a steady $1 peg - precisely the stability banks seek. Institutions will favor it over the price swings of XRP whenever possible.

Projections for the Coming Five Years

Over the next five years, Ripple should expand substantially as a payments infrastructure provider. That growth seems probable.

Yet I foresee little spillover to elevate XRP's price - mirroring patterns so far. The bank adoption narrative overlooks banks' preferred Ripple tools. Now, the company's stablecoin hands institutions a clear path to avoid XRP altogether.

Crypto markets will fluctuate as always, but on a five-year view, XRP likely lingers below $1 - well short of bullish forecasts.