XRP Is Up 400% in the Past 3 Months. Is It a Buy Now?

Ever since the U.S. presidential election in November, XRP (CRYPTO: XRP) has been on an absolute rocket ship. It's now up about 400% since the election and many investors think it could hit a new all-time high in 2025.

The good news, if you're an XRP investor, is that there are several key catalysts in place that could send this popular cryptocurrency soaring even higher during the next 12 months. Let's take a closer look.

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A new pro-crypto regulatory climate

First and most importantly, XRP continues to benefit from a pro-crypto regulatory environment under the Trump administration. The thinking here is simple: All of XRP's regulatory problems are suddenly going to go away, now that Paul Atkins, a known crypto advocate, has been nominated to replace Gary Gensler as the new head of the Securities and Exchange Commission (SEC).

Replacing Gensler is a big deal because a lawsuit between Ripple, the company behind the XRP token, and the SEC continues to drag on after more than four years. In December 2020, the SEC claimed that XRP is a security, and the case still has not been fully resolved. As it stands now, XRP is a security when sold to institutional investors, but a commodity when sold to retail investors.

Ripple executives admit that they will have spent more than $200 million on litigation to settle the case. And Ripple agreed to pay fines and penalties of $125 million to the SEC in August 2024, so you can see why investors are so excited about putting an end to this lawsuit once and for all. The longer it drags on, the more cash Ripple is going to bleed.

Clearing the deck of any regulatory issues could set Ripple up for a rapid expansion of its U.S.-based payments business. For example, Ripple recently launched a new dollar-backed stablecoin (called Ripple USD) to expand the functionality of its XRP blockchain ledger. Ripple also recently partnered with the SWIFT payment network on a new global payments initiative featuring the XRP token.

New spot ETFs

XRP appears to be garnering growing support from institutional investors as well. A growing list of investment firms have already filed applications with the SEC for a spot XRP ETF, so the current thinking is that at least one of these ETFs will be approved soon.

When these new spot ETFs start trading, they will give hedge funds, institutional investors, and first-time crypto investors yet another way to invest in XRP without needing to dip their toes directly into the spot crypto market. That, in theory, should lead to steady upward price movement for XRP.

While it may be asking too much for XRP to double in price, as Bitcoin (CRYPTO: BTC) did when its new spot Bitcoin ETFs were approved last January, there's reason to think that XRP could soon hit a new all-time high, surpassing the past peak of $3.84. Given today's price of $2.50 for XRP, that would represent a robust 60% gain.

How much higher can XRP go?

All that sounds amazing, of course. Indeed, it's very easy to find XRP price targets of more than $10, amid all this boundless optimism. In fact, I recently saw one ultra-bullish forecast calling for XRP to go parabolic and hit a price of $100.

The consensus appears to be that Ripple will quickly get back to business, and that XRP will benefit from all the pro-crypto moves made by the Trump administration. That will lead to a brand new set of opportunities for XRP, driving its further adoption on a global scale.

But will it?

Image source: Getty Images.

Consider the following. Even though World Liberty Financial, the Trump-affiliated crypto company, has invested more than $100 million in cryptocurrencies such as Ethereum and Chainlink, it has no public holdings of XRP. That's odd, right? Especially given that Ripple is based in San Francisco, and XRP is clearly Made in America.

Even though XRP is one of the digital assets being considered for a "national digital asset stockpile" by the U.S. government, it's really just speculation based on a meeting that Ripple Chief Executive Officer Brad Garlinghouse had with President Donald Trump in January. A much more likely scenario is Garlinghouse being named to a White House crypto advisory council.

Also, keep in mind that Ripple's all-time high dates to January 2018. That's an eternity in crypto time. So much so, in fact, that some crypto investors now refer to XRP as a "dino coin" ("dinosaur coin").

In the past decade, XRP has never once traded higher than $4. If you look at a long-term price chart for XRP, it resembles that of a meme coin: Minimal gains for long periods of time, punctuated by sharp upward spikes and intense investor interest followed by deep declines.

So keep your expectations in check. Yes, XRP has been on a rocket ship of late. But it may be running out of the rocket fuel needed to send it to truly stratospheric price levels in 2025.

Should you invest $1,000 in XRP right now?

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Dominic Basulto has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin and XRP. The Motley Fool has a disclosure policy.