Dominic Basulto, The Motley Fool
6 min read
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XRP is up almost 25% for the year amid rising investor sentiment about its future growth prospects.
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The fast-growing stablecoin industry could be the key to expanding the number of use cases for XRP.
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XRP continues to widen its role in cross-border payments, due to the cost advantages and efficiencies of blockchain technology.
XRP (CRYPTO: XRP) has been one of the top-performing cryptocurrencies of 2025. It's now up almost 25% year to date, and currently trades at a price of about $2.54, giving XRP a total market cap of $150 billion.
That's just the beginning of XRP's resurgence. The world's third-most valuable cryptocurrency could quadruple in price and be worth $600 billion within just five years. Here's one way that it could play out.
On the surface, a $600 billion valuation for XRP might appear unrealistic. After all, that's twice the current valuation of Ethereum.
So let's do a little math and consider the following question: How fast would XRP need to grow on a year-over-year basis to hit a market cap of $600 billion within five years?
The numbers might surprise you. XRP would need to grow at an annualized rate of 15% to double in price within five years. It would need to grow at an annualized rate of 25% to triple in price. And it would need to grow at an annualized rate of 32% to quadruple in price.
When you start to think about XRP from this perspective, the $600 billion number makes a lot more sense. The hard part is finding new business opportunities that are capable of growing at a fairly brisk 30% rate during the next five years.
The first huge opportunity for XRP involves stablecoins. These are dollar-pegged cryptocurrencies that are designed to track the value of the U.S. dollar on a 1-to-1 basis. Theoretically, the value of a stablecoin pegged to the U.S. dollar should always be $1.
The good news is that stablecoins happen to be one of the fastest-growing segments of cryptocurrency. The total value of the stablecoin industry is now $230 billion. According to the Brookings Institution, that's a more than 10-fold increase from $20 billion in 2019. So this is exactly the type of fast-growing business opportunity that XRP needs.
As you might have guessed, Ripple, the company behind the XRP token, has been making aggressive moves into the stablecoin industry. In December, it launched a stablecoin of its own, known as Ripple USD (CRYPTO: RLUSD). Then, in April, it made a $5 billion acquisition bid for Circle, the company behind the enormously popular USDC (CRYPTO: USDC) stablecoin.
