What Does XRP Really Do? Expert Explains What It Is Built For

The XRP Ledger works with transparent settlement, predictable transaction costs, and finality that does not depend on mining or complex smart contract execution. These characteristics are important for institutions that need clarity and reliability.

In practice, XRPs real-world role is most visible through payment solutions developed by Ripple. Banks and other financial institutions do not need to hold large balances of foreign currencies, since XRP can be used as an intermediate asset during settlement.

XRPs Current Regulatory And Institutional Position

Progress on regulatory clarity has been helping real institutional infrastructure around XRP. Multiple Spot XRP ETFs have gained approval and launched in 2025 and early numbers are positive, with over $1.14 billion worth of inflows. Bloomberg estimates suggest these funds could draw $5 billion to $7 billion in institutional capital by 2026.

This creates new avenues for asset managers, pension funds, and other institutional allocators to hold XRP within traditional investment vehicles. All these cannot be possible without the clear framework for blockchain, stable coins, and new payment systems proposed by Bessent.