Should You Buy the Dip on XRP?

Dominic Basulto, The Motley Fool

Thu, Jun 5, 2025, 7:33 AM 6 min read

• After soaring to a 52-week high in January, XRP is now down 35%.

• The most important near-term catalyst for XRP is imminent SEC approval of new spot ETFs.

• XRP has seen a significant decline in transaction activity over the past two months, raising questions about its future growth potential.

• 10 stocks we like better than XRP ›

Heading into 2025, XRP (CRYPTO: XRP) was the hottest crypto on the planet. But after hitting a 52-week high of $3.39 in January, XRP has fizzled out. It's now down 35% from its 2025 peak, and investors are understandably concerned.

Is now the time to buy the dip on XRP? Or is your money better spent elsewhere? Let's take a closer look.

Heading into November, XRP had basically flatlined at the $0.50 price level. However, after the presidential election, it suddenly surged, eventually reaching a multi-year high.

This makes sense, of course, because XRP was the one cryptocurrency destined to get the biggest bounce from a pro-crypto Trump presidency. Up until November, dark regulatory clouds were hanging over Ripple, the company behind the XRP token. The Securities and Exchange Commission (SEC) claimed that XRP was a "security" and not a "commodity." This asset class is subject to stricter regulations regarding trading, ownership, and reporting requirements.

However, as soon as Trump was elected, XRP skyrocketed. The logic was simple: a Trump presidency would likely lead to a shakeup at the SEC, which would then help lift all the regulatory clouds hanging over Ripple and XRP. And that's exactly what happened.

The problem is that this development has been replaced by a new narrative around global trade and tariffs. All of last year's pro-crypto euphoria has already been priced into XRP, and investors are looking for a new narrative to drive XRP higher.

The most likely new catalyst is SEC approval of spot XRP exchange-traded funds (ETFs). Already, there are several spot XRP ETF applications in the pipeline, including ones from Franklin Templeton (NYSE: BEN) and WisdomTree (NYSE: WT).

The thinking here is that a new pro-crypto approach at the SEC will give it the freedom to sign off on at least one of these ETF applications. The timing has been pushed back to the fourth quarter (Q4), but prediction markets are giving this a 93% chance of happening by the end of 2025. It's almost just a matter of "when," not "if."

If the success of the spot Bitcoin ETFs is any guide, then these new spot XRP ETFs could result in a tsunami of new investor money flooding into XRP, helping to push up its price.