The move from $0.60 to over $2.20 is just a priming blip: to understand XRP's potential power curve, one must dissect not the price line, but the settlement flow architecture that the asset captures at the banking level.

XRP is a zero-sum issuance bridge asset: total supply fixed at 100G, 46.5G actually in circulation, the rest in calendar escrow (1G released each month, unsold balance re-escrowed). This mechanism neutralizes net dilution provided that on-chain volume absorbs fresh supply; in practice, ODL (On-DemandLiquidity) consumed 58% of escrow outflows over 2024 and 2025Q1, pushing Ripple to abandon quarterly “Markets” reporting for a more granular institutional model – an indication that off-screen demand is already taking over from retail books ([CoinDesk][1]).

The second convexity driver is the regulatory resolution: on May 9, 2025, SEC and Ripple filed a joint agreement sealing four years of litigation. Secondary sales of XRP are excluded from the “securities” classification; only direct distributions of Ripple remain under the 1933 framework. The second-round effect is not so much legal as insurance-related: US desks can now integrate XRP into their inventory without provisioning for a future liability; the cash flow of bancassurers (tiers 1-3) generally follows three to six months later ([The Street][2]).

On the usage side, the ODL axis has shifted to a corridor-pool logic: Singapore⇌UAE and Mexico⇌EU exceeded $480M in average daily settlement in Q12025, supporting the hypothesis that a flow of 1% of the SWIFT market (approximately $5T/day) would be technically unmanageable without escalating network bandwidth. Ripple is responding by migrating to a unified order engine and introducing the “Unified Ledger” to agree ISO20022 messages – a necessary pivot for tier-1 banks to consider XRPL as a primary settlement rail, not simply a liquidity buffer ([21shares.com][3]).

On the protocol stack, three amendments modify the capturable value curve:

•Hooksv1: deterministic in-ledger execution, opening up to native programmability and tokenization of conditional settlements (lettersofcredit, repo lines) without an EVM gateway.

•EVMSidechain2.0(Peersyst): sub-two-second finality, 1000TPS, settled in XRP for fees, technical equivalent of a state-rolled L2 – thus capturing value on the layer1 asset.

•RLUSD(beta): T-Bills-backed stablecoin designed to serve as cross-collateral and reduce regime-native volatility, allowing corporate treasuries to buffer mark-to-market.

The arrival on May 8 of a US Treasury fund as XRPL holder validated IT-audit compatibility (SOC-2) and acted as a signal of compliance with the Fed stress tests ([Brave New Coin][4]). Flow models already show a correlation coefficient ρ≈0.68 between the daily value settled via ODL and institutional spot demand, which reinforces the hypothesis of a price=k×√(volumeODL) function in the initial adoption phases.

For an investor who entered at $0.60, the progression from $0.60 to $2.20 represents a multiple of 3.66x, but the decisive metric is not the absolute multiple; it is the delta between the real increase in escrow outflows actually absorbed (net burn) and the velocity on XRPL. Since January 2024, the median velocity has increased from 2.1 to 3.4 (year) while the effective supply has only grown by 3%, which implies an increase in the GVA (gross value added on-chain) ratio of 54%. The power curve of such an asset follows a log-parabolic model; under the conservative assumption of capturing 3% of the SWIFT market by the end of 2027, an “on-chain utility” pricing of $8.50–11.00 is justified by flow discount, excluding meta-speculation—predictions already put forward by CoinMarketCap Academy ([CoinMarketCap][5]) and reiterated by FXEmpire ([FXEmpire][6]).

Sticking points:

– Residual dilution: 400MXRP/month not consumed goes back into escrow, but remains latent.

– Speed ​​effect: if banks opt for weekly rather than just-in-time net settlement, intraday demand contracts; the price then follows a regime of lateral stability.

– CBDC rails competition: a massive deployment of sovereign stablecoins encapsulated in FedNow or TIPS could bypass ODL, reducing dependence on bridge-asset.

In short, XRP, from a post-regulatory setup buy-and-hold perspective, is similar to a call option on the industrialization of instant interbank settlement. The payoff is asymmetric: risk = momentum erosion if usage does not absorb the supply disconnection; reward = rent capture in a cross-border payments market valued at $156T per year. The informed investor will model the portfolio as a barbell: delta-neutral hedged portion via perp funding, long convexity portion via spot holding; this is the only way to fully exploit the log-parabolic curve without exposing oneself to a decline in velocity.

Market analysis is purely informational; each reader must model their own risk spectrum before allocation.