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Ripple's CTO argued 8 years ago that banks would need $XRP to be expensive.
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Every $RLUSD stablecoin transaction on the $XRP Ledger requires $XRP as a gas fee, putting $XRP at the centre of Ripple's $33 trillion stablecoin target.
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Ripple just valued itself at $50 billion while $XRP is still 63% down from its peak.
$XRP is trading at $1.39 today, down 63% from its peak. And while most holders are staring at the price waiting for a recovery, they may be missing the more important question: does $XRP even work if the price stays low?
According to Ripple’s own CTO, the answer is no.
David Schwartz Said It Eight Years Ago
In a post on Kora that went viral at the time, Ripple CTO David Schwartz laid out the logic plainly.
As highlighted recently by crypto analyst Levi, Schwartz wrote: “The price of $XRP you need to make a $1 million payment will always be at least $1 million. Higher prices tend to correlate with higher liquidity, which means cheaper payments.”
The argument is not complicated. If a bank needs to move a billion dollars and $XRP is trading at five cents, buying that much $XRP would move the price dramatically mid-transaction – creating slippage that makes the whole thing impractical.
A higher market cap means the same transaction barely moves the needle. Banks don’t just tolerate a high $XRP price. They require it.
The $33 Trillion Target
Ripple’s recent moves make more sense through this lens. The team has been expanding $RLUSD, its stablecoin, on the $XRP Ledger, with a stated target of the $33 trillion stablecoin market. As Levi points out in his analysis, every single $RLUSD transaction on the XRPL requires $XRP as a gas fee.
The stablecoin removes slippage concerns for banks while still keeping $XRP at the centre of every transaction.
The strategy, Schwartz outlined years ago, starts with smaller currency corridors – markets like Euro to INR where margins are thin and inefficiencies are high – before moving up to the major currencies that move trillions daily.
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The Structural Pieces Are Now Real
What’s changed since Schwartz first made this argument is that the infrastructure is actually being built. Ripple received conditional approval for a national trust bank charter from the OCC in December 2025. Mastercard added Ripple to its 85-company global Crypto Partner Program on March 11, alongside Binance, PayPal, Circle and Gemini.
Ripple also launched a $750 million share buyback in March, valuing the company at $50 billion – a 25% increase from its November funding round. The company is pricing its equity higher while the token trades near lows.
That gap says something about where Ripple’s leadership thinks this is heading.
Crypto Sensei also flagged on-chain data showing $XRP’s multi-exchange withdrawal delta has fallen to an all-time low – meaning more investors are moving $XRP off exchanges, historically a bullish signal for long-term holders.
The Schwartz argument was always logical. The question was whether the real-world pieces would fall into place. In 2026, they are starting to.