XRP leads the Trump trade bull run. But can it actually sustain it?

XRP has skyrocketed 370% since Donald Trump’s election victory, taking the lead in what’s now being dubbed the “Trump trade bull run.”

Bitcoin, for all its clout, has only climbed 46%, and the broader crypto market, measured by the CoinDesk 20 index, has risen 93%. XRP blew past Solana, claiming the third spot in market value, sitting behind only Bitcoin and Ethereum.

Matt Hougan from Bitwise Asset Management called it logical. “The asset that’s been at the front of the Peloton taking the regulatory headwinds has been XRP,” he said, adding that if regulation flips from a headwind to a tailwind, XRP stands to gain the most.

Whether you’re an XRP fan or not, the numbers don’t lie. But the rally is more than numbers; it’s a loud victory lap for XRP’s hardcore supporters, who stayed loyal even when Ripple, XRP’s parent company, was locked in a brutal legal brawl with the SEC.

From courtroom clashes to ETF dreams

XRP was created in 2012 as the native token of the XRP Ledger, an open-source blockchain powering Ripple’s cross-border payments system. The irony? While Ripple focuses on global transactions, 95% of its business happens outside the U.S.

Ripple also happens to hold the majority of XRP’s supply, which makes things interesting when regulation gets involved. The SEC battle has been a headache for years. Last summer, the drama hit its peak.

A judge ruled that XRP wasn’t a security when sold to retail investors on exchanges but was an unregistered security offering when sold to institutional investors. It’s a win, sort of, but it cleared the air enough for XRP to thrive.

Now, heavy hitters like Bitwise, WisdomTree, and 21Shares are lining up to launch XRP-backed ETFs. That’s one reason XRP is now the third-largest crypto, but size alone doesn’t guarantee a future.

Alex Thorn from Galaxy Digital isn’t sold. He called XRP a “blast from the past” and questioned whether it’s anything more than clever marketing. “It’s never really had a clear product-market fit,” he said, pointing out its low liquidity and bloated valuation.

What’s driving XRP’s wild ride?

XRP’s secret sauce might be its unique consensus mechanism. Unlike Bitcoin’s energy-hogging proof-of-work or Ethereum’s proof-of-stake, XRP uses a cheaper, more efficient method.

Hougan pointed to this as a core strength, saying it’s a reason XRP has survived boom-and-bust cycles that would’ve buried less resilient projects. “This technology works and functions with a low underlying cost,” he said.

The problem? XRP’s real-world use hasn’t taken off like its backers hoped. Critics argue that Ripple’s focus on business-to-business solutions puts it in a weird spot, especially when regulators had a sword hanging over its head.

Now that the SEC drama has cooled, XRP has a rare chance to show what it can do in an “unfettered environment.” But as Hougan put it, nobody knows for sure what that will look like — or if the market will even care.

On the charts, XRP is testing nerves. After hitting resistance on December 12, it fell back to $2.11, its 20-day EMA. Bulls quickly stepped in, snapping up the dip and pushing prices toward $2.65. If it breaks that level, the next stop could be $2.91.

Above that, the rally could extend to $3.50. Bears, however, are circling at $2.91, ready to fight tooth and nail to keep it from going higher.

On the flip side, XRP’s 20-day EMA and the $1.90 Fibonacci retracement level are acting as strong safety nets. If the bears manage to drag it below those levels, things could get bad fast.