21Shares Sees XRP Upside but Flags Demand Risk
21Shares identified four pillars supporting its XRP investment case: clearer US regulation, expanding institutional access, growing XRP Ledger (XRPL) usage and XRP’s fixed maximum supply of 100 billion tokens.
The asset manager said the conclusion of Ripple’s long-running SEC case in August 2025 removed a major compliance obstacle. Regulatory conditions reportedly improved further in 2026. Spot XRP exchange-traded funds launched in the US last November and attracted more than $1 billion in roughly six weeks, with cumulative inflows later exceeding $1.7 billion.
XRPL processed nearly $500 billion in on-chain value over the past 12 months. Ripple’s RLUSD stablecoin grew from a $72 million market capitalisation to $1.6 billion in less than two years, while tokenised assets on XRPL reached about $4 billion. 21Shares also noted that XRP has no ongoing inflation schedule, although transaction fees permanently remove a small amount of supply.
However, 21Shares highlighted a key risk: greater XRPL activity may not create sustained XRP demand. Institutions can use the network while holding XRP briefly, or with limited exposure. The investment thesis therefore depends on payments, stablecoins and tokenised assets translating into long-term value accrual for XRP. XRP was still struggling to break above the $1.40 resistance level at the time of publication.
Neutral
The report is structurally positive for XRP because it highlights regulatory clarity, spot ETF inflows, institutional access and strong XRPL network activity. These factors could support short-term trader interest, particularly if ETF inflows continue or XRP breaks above the $1.40 resistance level. Similar regulatory breakthroughs and ETF-launch narratives have historically produced sharp rallies in major crypto assets, although those moves often depend on sustained inflows and broader market momentum.
The immediate impact is limited by the report’s central warning: network usage does not automatically create durable demand for XRP. Institutions may use XRPL for settlement while holding XRP only briefly, reducing the effect on long-term token accumulation. The failure to clear $1.40 also suggests that traders remain cautious despite improving fundamentals.
As a result, the news is best classified as neutral rather than outright bullish. It may improve XRP’s long-term investment narrative and provide support during market weakness, but it does not establish a clear mechanism for value accrual. Short-term volatility could rise around ETF flow data, regulatory developments and resistance tests. Longer term, XRP would likely need sustained liquidity growth, higher token holding requirements and measurable demand from payments or tokenised assets to shift the market view decisively bullish. A reversal in ETF inflows, renewed regulatory uncertainty or broader crypto weakness could instead pressure XRP.