XRP is currently facing notable challenges in the cryptocurrency market, highlighted by sharp criticism from industry figures. Tom Zschach, Chief Innovation Officer at Swift, has dismissed Ripple, the company behind XRP, as a “dead chain walking.” His remarks come amid XRP’s ongoing efforts to maintain its decentralized finance (DeFi) activities while grappling with formidable competition from leading networks such as Ethereum, Solana, and stablecoins like Circle’s USDC.
The skepticism surrounding XRP is amplifying as Zschach underscored that merely surviving legal battles does not equate to true resilience. He emphasized that real compliance stems from an industry-wide consensus on neutral standards, suggesting that institutions are hesitant to base their future payment infrastructures on a competing chain like Ripple’s.
This sentiment aligns with traditional finance’s growing belief that stablecoins, particularly USDC, are better positioned to serve as the backbone of global settlement systems than XRP. Such a narrative threatens to undermine Ripple’s claims of being a pivotal bridge asset for banks and institutional players.
The stark figures depict XRP’s plight in the DeFi landscape. Data from DeFiLlama reveals that XRP Ledger’s DeFi ecosystem has amassed only $87 million in total value locked, with daily decentralized exchange volumes struggling to reach $70,000. In contrast, Ethereum boasts a total of $96.9 billion locked, and Solana has attracted $11 billion. Notably, even Coinbase’s Base chain, still in its infancy at two years old, has nearly $5 billion locked, underscoring XRP’s struggles in attracting user engagement.
The derivatives market further reinforces this narrative, as XRP’s futures open interest remains significantly behind that of Ethereum and Solana. This disparity suggests that large institutional investors are not committing to XRP, and without sufficient liquidity and active development, XRP is finding it difficult to establish the necessary network effects for growth.
In response to these challenges, Ripple is making strides to revitalize interest and activity within its ecosystem. The company is poised to launch upgrades that include Automated Market Makers and new liquidity pools. Additionally, Ripple is introducing its RLUSD stablecoin and inviting Circle’s USDC to be utilized on the XRP Ledger. Efforts are also underway to test an Ethereum-compatible sidechain to facilitate development on XRPL.
Despite these measures, community leaders stress that genuine engagement is vital for XRP’s future. Marketplace founder Adam Kagy highlights the critical need for meaningful retail participation and on-chain activity. He suggests that without substantial user engagement, enterprises may remain reluctant to build on such networks.
A pressing question looms over Ripple: can it ultimately demonstrate that its infrastructure is capable of supporting enterprise-level adoption while mitigating centralization risks? Antony Welfare, a former advisor on Central Bank Digital Currencies (CBDCs) at Ripple, stresses that the reliability of infrastructure is crucial for gaining institutional trust. He cites Hyperledger Besu’s integration with Ethereum as a prototype of successful enterprise-grade adoption.
Should XRP fail to showcase its capability in this regard, it risks being overshadowed by stablecoins and compliance-oriented competitors. Currently, XRP is priced at $2.7966, reflecting both its ongoing survival and the considerable challenges it faces in a competitive market.
