Ripple’s Stablecoin Boom Raises Awkward Question For XRP Holders

In a long-form breakdown, book author Dana Love argues that Ripple’s record 2024–2025 run — capped by a $40 billion valuation, major acquisitions and institutional integrations — is being driven by stablecoin economics and enterprise plumbing, not by rising fundamental demand for XRP itself.

Ripple launched RLUSD in December 2024 on both Ethereum and the XRP Ledger. Within a year, it had climbed into the top 10 stablecoins, with market cap jumping from roughly $132 million to about $1.6 billion.

Institutions from Deutsche Bank to MasterCard and BlackRock’s Securitize-linked tokenized treasury fund are using Ripple’s infrastructure, with RLUSD increasingly at the center.

The analyst walks through the XRP Ledger’s design: a native DEX, automated market makers, and XRP as the built-in bridge asset. On paper, RLUSD growth should deepen RLUSD–XRP pools, lower slippage, and increase XRP’s role as a routing asset — a core pillar of the XRP “utility” thesis.

But the YouTube video draws a sharp distinction between throughput and value accrual. XRP, in this framing, is the settlement bridge held for seconds, while RLUSD is the unit of account that users actually hold.

“The toll road carries the value. The real estate captures it. RLUSD is the real estate. XRP is the toll road,” Love says, noting that XRP’s transaction fee on XRPL is about 0.0000011 XRP — effectively a rounding error even on multimillion-dollar transfers.

Most RLUSD activity initially gravitated to Ethereum, where DeFi liquidity and yield opportunities are deeper. At one point, more than 80% of the RLUSD supply reportedly lived on Ethereum, powering Aave and other protocols — and paying fees to Ethereum validators, not benefiting XRP holders.

Ripple is now actively pulling supply back. In one May transaction, the company burned $100 million in RLUSD on Ethereum and minted $200 million on the XRP Ledger.

Even so, the analyst notes that after 14 years of XRPL operation, total XRP burned via transaction fees is only about 14 million out of 100 billion, underscoring how little value the network’s throughput has captured for the token.

To explain Ripple’s strategy, Dana Love focuses on incentives. For years, Ripple funded itself by selling pre-mined XRP via OTC channels while locking and unlocking escrow. That model hit legal and practical limits, especially during the SEC lawsuit.

RLUSD changes the equation. As a fully backed stablecoin, it generates recurring yield on reserve assets (primarily Treasuries), plus issuance and redemption fees.

Ripple has paired this with aggressive M&A: a $1.25 billion acquisition of prime broker Hidden Road (rebranded Ripple Prime) and a $1 billion purchase of G Treasury, which handles $12.5 trillion in annual payment volume for large corporates. These are infrastructure businesses where RLUSD, not XRP, is the primary revenue driver.

When Ripple raised $500 million at a $40 billion valuation in late 2025 from Fortress, Citadel Securities, Galaxy Digital and others, several investors reportedly estimated that about 90% of Ripple’s net asset value was XRP sitting on its balance sheet.

Yet they bought equity, not the token — gaining upside exposure to XRP plus downside protection and liquidation preference. “Same bet on XRP. Just better terms and an earlier exit,” the analyst notes.

The video is explicit: the idea that XRP price will be driven by network usage and cross-border payment volume is, in the analyst’s view, effectively dead. RLUSD is handling the cross-border leg in Ripple’s own documentation; XRP’s main functional role on that path is account activation and a tiny fee.

Dana Love instead points to a different engine: financial demand via regulated access, mirroring Bitcoin’s trajectory. XRP ETFs launched in late 2025 and have attracted around $1.4 billion in inflows so far, but that has not translated into upward price pressure yet.

Everything now turns on the U.S. “Clarity” market structure bill, which passed Senate Banking Committee 15–9 on May 14 but still needs 60 votes on the Senate floor and subsequent rulemaking, likely pushing real impact to 2027.

If XRP is formally classified as a digital commodity, major institutions, ETFs and insurance vehicles could hold it as an asset, regardless of whether they use it for payments.

For investors, Dana Love's message is stark: Ripple’s operational success is increasingly decoupled from XRP’s on-chain utility. Any future upside may depend less on On-Demand Liquidity (ODL) volumes or RLUSD growth and more on whether U.S. regulators flip the switch that lets big money simply hold XRP at scale.

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