Should You Forget Bitcoin and Buy XRP Instead?

Should an asset be judged by what it can be used to do, or by how little it needs to do to maintain its value? That's one of the questions separating the investment theses for XRP (CRYPTO: XRP) and Bitcoin (CRYPTO: BTC), and lately, some investors have been suggesting that it's time to drop the king cryptocurrency entirely in favor of investing in XRP.

So, is forgetting Bitcoin a smart move here or not? Let's check it out.

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Stores of value aren't meant to change a lot

Why would someone want to own Bitcoin in the first place? It can't run any smart contracts, and there are no plans to upgrade its core technology to add any dramatic new capabilities.

In short, a store of value wins when it's hard to dilute, easy to own, and simple to understand over decades. Bitcoin checks those boxes, and because it won't change much, it'll likely continue to check them over time. Its supply is capped at 21 million coins, with its new issuance from mining declining on a known halving schedule.

The network does not promise much at all. The two core things it does promise are that its new supply will get scarcer, and that the rules governing the chain will not change much, if they do at all. So don't expect Bitcoin to be able to pivot to compete in emerging market segments, even if they're extremely alluring or a great match for its underlying tech.

With that in mind, Bitcoin will likely lag utility-driven assets from time to time, but the hurdle for it to remain relevant is low. The fewer moving parts an investment thesis requires, the fewer ways it can break, and Bitcoin's is dead simple, for good and for ill.

Being clever pays off, but it's hard to do consistently

XRP aims at a very different job than Bitcoin, as it's trying to be institutional-grade financial infrastructure. That means it needs to offer features like smart contract support, regulatory compliance tooling, an automated market maker (AMM), and on-demand liquidity for trade settlement, all at the scale financial institutions need.

Ripple, the company that issues XRP, is also expanding the technology stack around XRP. In late 2024, it launched Ripple USD, a stablecoin intended to meet institutional standards for trust, utility, and compliance. The strategic logic is that a big base of stablecoin value plus compliance tooling plus institutional relationships and other features to sweeten the pot for banks and big capital holders can pull real financial activity onto the XRPL.

There's already clear evidence of traction in attracting tokenized real-world assets (RWAs) and stablecoins on the network, with RWA value, holders, and transfer volumes growing substantially over recent months.

It's obvious that Bitcoin isn't exposed to any of those opportunities, as it's actually permanently sidelined from them by virtue of its lack of features. Thus, while XRP is very likely to see an increase in demand for its coin due to new users needing to hold it to participate in the chain's many services and capabilities, there's no such driver for demand of Bitcoin. And as the intermingling of the traditional financial sector and crypto picks up over the coming years, in theory that could allow XRP to tremendously outperform Bitcoin. Therefore, it's time to sell Bitcoin and go all-in on XRP -- or so the argument goes.

However, the competitive bar keeps rising, and that's a far larger problem for XRP than it could ever be for Bitcoin.

Traditional fintechs are not standing still as XRP makes inroads into their target market, and other chains are courting the exact same users. Consider that Western Union, a giant in cross-border transfers, plans to launch a dollar-backed stablecoin on the Solana blockchain in the first half of 2026. That's not fatal to XRP's case whatsoever, but it shows the field is increasingly contested, and that winning users and their capital is a never-ending job.

As time goes on, it is likely that XRP will eventually lose at least one of its competitive fights, or be forced to retrench on certain core priorities at the expense of others. The market probably won't treat that kindly. If you sell all your Bitcoin and buy XRP with the proceeds, when those difficult days roll around -- regardless of whether the chain can successfully pivot and recover, which it probably will -- you'll be hurting.

So, to tie it all together, assuming that Ripple continues to ship institutional features and win new partners, there is a solid chance XRP outperforms in utility-driven phases, especially if tokenized assets, bank-friendly controls, and compliant stablecoin rails compound together, as it appears they are currently. But XRP's forward returns depend on consistent and successful execution by many actors over many years. Bitcoin's do not, at least not to the same degree.

In practice, that means Bitcoin belongs as the core crypto position for most investors, with XRP as a smaller allocation for those who want targeted exposure to the institutional finance thesis.

Alex Carchidi has positions in Bitcoin and Solana. The Motley Fool has positions in and recommends Bitcoin, Solana, and XRP. The Motley Fool has a disclosure policy.