XRP Surpasses Ether in Fully Diluted Valuation, Gains 300% Since US Elections

XRP, the native token of the XRP Ledger, has surpassed Ether (ETH) in terms of fully diluted valuation (FDV), marking a significant shift in the market dynamics of layer-1 (L1) blockchain networks. According to data from March 14, XRP's FDV reached nearly $235 billion, surpassing Ether's FDV of $233 billion. This reversal is indicative of the growing traction of XRP Ledger's decentralized finance (DeFi) ecosystem and the increasing competition Ethereum faces from rival L1s such as Solana.

The FDV metric, which measures the cumulative value of all existing tokens, provides a different perspective compared to market capitalization, which only counts tokens already in circulation. As of March 14, Ether's market capitalization still leads at $233 billion, while XRP's market capitalization stands at $136 billion. This discrepancy is partly due to Ripple Labs, the developer of XRP, holding a significant allocation of its native token.

XRP's price has surged by over 300% since the US elections in November 2024, reaching around $2.3 per token. This price increase can be attributed to the favorable regulatory environment under the Trump administration, which has appointed industry-friendly leadership to key regulators. The administration's stance on cryptocurrencies, aiming to make America the "world’s crypto capital," has been particularly beneficial for XRP, which prioritizes enterprise users and has unveiled an institutional DeFi roadmap.

The XRP Ledger's native decentralized exchange (DEX) has handled more than $1 billion in swap transactions since its launch in 2024, further bolstering the token's support. Additionally, President Trump's proposal to include XRP in a US Digital Asset Stockpile, alongside other cryptocurrencies like Solana (SOL) and Cardano (ADA), has provided further backing for the token. The stockpile, however, will not involve direct purchases of crypto assets but will comprise assets acquired through legal proceedings.

The US Securities and Exchange Commission (SEC) is reportedly nearing the conclusion of an enforcement action against Ripple, which has been ongoing since 2020. The SEC has already dropped actions against other crypto firms such as coinbase, Kraken, and Uniswap, signaling a potential easing of regulatory pressure on the industry.

In contrast, Ether's spot price has faced challenges since March 2024, when the network's Dencun upgrade significantly reduced transaction fees. Despite this, trading volume on Solana, which focuses on fast transaction execution, has rivaled that of Ethereum and its layer-2 scaling chains combined. This competition highlights the evolving landscape of L1 blockchain networks and the increasing pressure on Ethereum to maintain its market position.