Why I Own XRP (Ripple) as Part of a Balanced Portfolio

As an emerging tech investor focused primarily on growth stocks and disruptive technologies, I've built most of my portfolio around companies revolutionizing artificial intelligence (AI), cloud computing, and digital transformation. However, I also maintain strategic positions in select cryptocurrencies -- not as speculative bets, but as calculated hedges against traditional financial systems. Among my crypto holdings, which include Bitcoin (CRYPTO: BTC), Cardano (CRYPTO: ADA) and Dogecoin (CRYPTO: DOGE), XRP (CRYPTO: XRP) stands out as my most conviction-driven position.

The crypto market has matured significantly since the speculative frenzy of previous cycles. Today's landscape offers genuine utility tokens solving real-world problems, and XRP exemplifies this evolution. While my tech stocks represent investments in companies disrupting existing industries, XRP serves a different purpose entirely: It's my hedge against the inefficiencies of global finance itself. The current SWIFT system takes 18 hours and costs up to $50 per international transfer, while XRP settles in seconds for roughly $0.0002 per transaction.

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While the SEC lawsuit isn't fully resolved -- Judge Torres rejected a key settlement motion in May -- both parties appear to be moving toward resolution. Rumors suggest a potential settlement announcement as early as June 13, which, combined with Trump's crypto-friendly stance and potential exchange-traded fund (ETF) approval, create a unique opportunity.

But I'm not chasing quick gains -- I view XRP as essential portfolio insurance that could appreciate significantly as traditional finance struggles to keep pace with our digital economy.

The hedge against banking inefficiency

XRP represents my bet that traditional banking infrastructure will eventually be disrupted by blockchain technology. RippleNet already processes over 1 million transactions daily, proving that financial institutions are adopting this technology at scale.

While SWIFT handles $150 trillion in annual transfers with its antiquated system, XRP demonstrates that cross-border payments can settle in seconds for fractions of a penny instead of days for $30 to $50.

By owning XRP, I'm positioning myself to benefit when this superior technology inevitably displaces legacy systems. If blockchain disrupts traditional payment networks the way the internet disrupted media companies, XRP could appreciate significantly as the infrastructure powering that transformation.

Why XRP over other cryptocurrencies

While I own Bitcoin as a digital gold hedge, Cardano for its academic approach to blockchain development, and Dogecoin as a small speculative position, XRP fills an entirely different role. Unlike most cryptocurrencies still searching for use cases, Ripple Labs has established partnerships with financial institutions and supports over 1,500 projects on the XRP Ledger.

The recent launch of Ripple's RLUSD (CRYPTO: RLUSD) stablecoin further validates this ecosystem approach, positioning XRP to capture value, as the stablecoin market is expected to grow from around $204 billion in 2024 to $3.7 trillion by 2030. This combination of real utility, institutional partnerships, and expanding use cases sets XRP apart from purely speculative crypto plays.

The institutional catalyst ahead

Polymarket shows 90% odds of an XRP ETF approval this year, which Standard Chartered estimates could drive $4 billion to $8 billion in first-year inflows -- equivalent to adding a PayPal-sized buyer to the market. However, meaningful institutional adoption depends on the final SEC lawsuit resolution.

The June 13 settlement rumors matter less than the eventual regulatory clarity, which would remove the last major barrier preventing institutions from adding XRP to portfolios. Until then, I view current prices as an opportunity to accumulate before broader market participation.

Strategic accumulation approach

I dollar-cost average into XRP monthly, keeping emotions out of the equation. This isn't about chasing Standard Chartered's eye-popping $12.5 price target or timing market cycles -- it's about methodically building a position in a technology I believe will become essential infrastructure. Just as I accumulated cloud computing stocks before enterprises fully embraced the technology, I'm positioning in XRP before traditional finance fully embraces blockchain settlement.

The risk/reward calculation

Despite the compelling use case, I only maintain a 1% portfolio allocation in this cryptocurrency. As such, my XRP allocation won't make or break my financial future, but it provides exposure to a potentially massive shift in how money moves globally.

If I'm wrong, I lose 1%. If I'm right about blockchain disrupting SWIFT's $150 trillion annual flow, the upside justifies the risk. That's the kind of asymmetric opportunity I seek as an emerging tech investor.

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George Budwell has positions in Bitcoin, Cardano, Dogecoin, and XRP. The Motley Fool has positions in and recommends Bitcoin, PayPal, and XRP. The Motley Fool recommends the following options: long January 2027 $42.50 calls on PayPal and short June 2025 $77.50 calls on PayPal. The Motley Fool has a disclosure policy.