Why XRP’s sudden popularity with institutions means it will be ‘an outperformer’

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bullish:

bearish:

XRP might be on the verge of a major price rally.

Last week, institutional investors bagged $37 million worth of XRP even as most cryptocurrencies struggled to attract capital, according to research firm CoinShares.

This surge places XRP just $1 million behind Ethereum in yearly inflows. More than $772 million has flowed out of Ethereum in the past eight weeks.

There are a number of factors at work with XRP, the cryptocurrency Ripple uses to facilitate cross-border payments. One is the US Securities and Exchange Commission’s decision to drop its long-running litigation against the company.

“With the negatives from SEC action being behind us, it opens up the path for positive newsflow to occur throughout the year,” Luke Nolan, Senior Ethereum Research Associate at CoinShares, told DL News.

“XRP is very likely to be one of the outperformers.”

That’s if Bitcoin can sustain its momentum, Nolan said.

Pivotal moment

XRP’s popularity comes at a pivotal moment.

With Coinbase launching regulated XRP futures, and 72 exchange-traded funds applications under review by the SEC, the $37 million inflow could be the first sign of institutional investors positioning themselves ahead of more regulatory developments.

XRP’s capital inflows aren’t about the token itself — instead they signal broader trends, say analysts.

“XRP tends to be a barometer for momentum, especially after the Trump election and the lax stance the SEC has adopted,” Nolan told DL News.

“With this ‘clear skies’ mentality from a legal standpoint, it has been by far one of the strongest performers since November 5th.”

XRP is up 300% this year, and trades for $2.19.

Rangebound altcoins

The top cryptocurrency has continued to grind higher while most altcoins remain range-bound — except for XRP and a select few others.

Hedge funds are expecting further Bitcoin dominance.

“Retail and institutions are positioning as such and are anticipating one of the strongest alts to remain so and outperform over the shorter term,” Nolan said.

Market watchers are equally expectant about a potential ETF approval for XRP.

On Wednesday, Polymarket punters put the chances of the Securities and Exchange Commission approving an XRP ETF this year at 73%.

The SEC is reviewing five XRP ETF applications and has until mid-October to make a decision.