Bitcoin remains the leading cryptocurrency, yet it has significantly underperformed compared to XRP over the past year.
The cryptocurrency industry has been anything but boring recently. With the Trump administration stepping in this January, there has been a substantial shift towards a more pro-cryptocurrency stance. The president mandated the establishment of strategic reserves for digital assets, and regulators have dropped several lawsuits against crypto companies.
Despite these developments, Bitcoin (BTC -7.85%) and XRP (XRP -15.83%) (Ripple) have seen declines in 2025, even though XRP has significantly outshined Bitcoin in the past year. It’s a bit perplexing, particularly for Bitcoin, the largest and most notable cryptocurrency.
Is XRP’s relative strength merely coincidental, or is it currently the better cryptocurrency investment? Let’s explore whether XRP or Bitcoin is the superior buy today.
Potential Catalysts for XRP and Bitcoin — or at Least They Were Supposed to Be
XRP and Bitcoin rank among the four largest cryptocurrencies. XRP boasts a market cap of $125 billion, while Bitcoin’s market value reaches an impressive $1.7 trillion. Ripple Labs, a financial technology firm, developed XRP to streamline cross-border transactions on its blockchain-powered Ripple network.
Bitcoin is the first cryptocurrency, often compared to gold. It is a decentralized digital currency that both investors and businesses can accumulate to hedge against inflation or utilize for transactions where accepted.
Cryptocurrencies can evoke mixed feelings among investors due to their value being primarily driven by supply and demand. They don’t represent any tangible assets or underlying businesses like commodities, real estate, or stocks.
What is the best way to stimulate demand for cryptocurrencies? Increase adoption. The higher the global economy’s adoption of cryptocurrencies, the more likely it is for demand (and prices) to rise.
Recent U.S. government actions could significantly impact XRP and Bitcoin in this regard. The Trump administration has announced the intention to begin accumulating certain digital assets seized from criminal activities rather than selling them. Ripple’s CEO expects that the stockpile will include XRP.
Moreover, regulators have dropped their appeal in a protracted lawsuit against Ripple. This litigation, which started in 2020, was arguably a hindrance to broader adoption of the Ripple network by financial institutions.
The U.S. government is also in the process of establishing a dedicated Bitcoin reserve. Initially, it will be stocked with seized Bitcoin, but future purchases could occur.
Why Have Cryptocurrencies Fallen Flat? Here’s Why
This marks a significant, positive shift from the government’s previous stance on cryptocurrencies. One might expect that XRP and Bitcoin would have surged following the announcements in March. However, this appears to be a classic case of buying the rumor and selling the news.
Donald Trump incorporated cryptocurrencies into his presidential campaign messaging. Following the election in early November, the market for cryptocurrencies and the broader sector rallied vigorously when it became apparent that a pro-cryptocurrency administration was taking charge.
However, post-inauguration, certain policies from the administration, such as tariffs, have cast a shadow over the market outlook, leading investors to shy away from riskier assets like technology stocks and cryptocurrencies. As a result, XRP, Bitcoin, and the technology-focused Nasdaq Composite (^IXIC -5.82%) have all retreated from their mid-January highs:
XRP Price data by YCharts
As significant as these developments may eventually prove for XRP and Bitcoin, they seem to have been overshadowed by broader market volatility.
Should You Buy XRP or Bitcoin?
Over the past decade, cryptocurrencies have undergone dramatic boom-and-bust cycles. While there’s no guarantee of perpetual price rebounds, this is historically regarded as normal volatility. The key is to manage your risk and limit cryptocurrencies to a small segment of your overall portfolio.
If we are entering a new crypto winter, there’s no telling how low prices could drop. Although XRP has performed well over the last year, investors might find greater peace of mind holding Bitcoin, the most established and widely recognized cryptocurrency.
This doesn’t mean that XRP isn’t worth considering. With the lawsuit now resolved, XRP could emerge as a long-term winner if financial institutions increasingly utilize Ripple’s network for cross-border transactions.
Ultimately, however, I believe it speaks volumes that the government is setting aside a dedicated reserve for Bitcoin. Given the current uncertainties, it may be the wiser investment choice.
