New Protocol Seeks to Boost XRP's Earnings Potential

The Rise of XRP and Its New Opportunities

XRP, one of the top cryptocurrencies by market capitalization, has experienced a significant surge in recent months. This growth is largely attributed to Ripple, the company behind XRP, overcoming its legal challenges and finding itself in a more favorable regulatory environment. The U.S. Securities and Exchange Commission (SEC) has shown a more relaxed approach toward cryptocurrencies, which has opened new doors for digital assets like XRP.

In addition to this regulatory shift, the political landscape has also played a role. Former President Donald Trump and First Lady Melania Trump have both introduced their own cryptocurrency tokens. Before the 2020 election, Trump made it clear that he would support the development and adoption of cryptocurrencies.

The combination of Ripple’s legal victories and the potential influence of Trump’s policies led to a sharp increase in XRP’s value. It has risen over 508.8% from its 52-week low, indicating a strong rally that could be sustained if the current trend continues. With a more supportive administration, the crypto industry may have a window of several years to expand and integrate into the global financial system.

Expanding Use Cases for XRP

Originally designed to streamline cross-border remittances, XRP was built as a bridge currency for financial institutions. Its goal was to reduce the friction associated with traditional systems such as SWIFT. Over time, XRP's use cases have expanded beyond payments to include smart contracts, decentralized identity protocols, tokenized assets, and even central bank digital currencies (CBDCs).

These developments have contributed to growing investor confidence in XRP. However, there is another factor that could significantly boost its performance: the introduction of yield-generating opportunities for holders.

XRP Could Become One of the Highest-Yielding Cryptocurrencies

For much of its history, XRP has underperformed compared to similar-sized cryptocurrencies. While many altcoins allow users to stake their tokens and earn rewards, XRP lacked any native yield mechanism. This has changed with the emergence of DeFi protocols like MoreMarkets, which enable XRP holders to generate returns on their tokens without giving up control.

Through self-custodial smart contract vaults, users can deposit XRP into specialized platforms that automatically allocate funds to vetted third-party DeFi strategies. This innovation allows retail investors to access automated yield generation, potentially making XRP one of the highest-yielding cryptocurrencies available.

Currently, yields are around 5%, but the platform has already seen $2.5 million deposited as of July 24. As MoreMarkets gains traction, it could provide a stronger incentive for long-term holding of XRP.

Does This Change the Paradigm for XRP?

It’s important to note that this isn’t traditional staking, where users lock up tokens to help secure a network and earn rewards. XRP’s blockchain doesn’t support native staking, so MoreMarkets operates more like yield farming—where users move assets across different protocols to maximize returns.

While this development could encourage more people to hold XRP, it’s unlikely to completely transform the ecosystem. A consistent 20% yield is unrealistic, and a 5% to 10% return is more plausible, aligning with what other chains offer.

Should You Buy XRP Now?

XRP currently has strong support at $3, but it faces significant resistance between $3 and $3.30. The price has struggled to break above its 7-day moving average, suggesting that investors should wait for a confirmed breakout above $3.30 before gaining confidence in a sustained rally.

In the long term, XRP remains a compelling investment due to its potential for expanding partnerships and its role in the broader crypto ecosystem. The approval of spot ETFs could trigger substantial inflows, with JPMorgan estimating up to $8 billion in the first year. Additionally, the anticipation of an "altseason" could lead to increased investment flowing into altcoins like XRP.

As always, it’s essential to conduct thorough research and consider your own risk tolerance before making any investment decisions.