Background Information: XRP is a cryptocurrency promoted by Ripple, often marketed as a transformer of payments and cross-border transactions.

Main Event: Jeff Dorman, Chief Investment Officer of Arca Crypto Hedge Fund, questioned the financial utility of XRP, labeling it a "meme coin" and citing the example of the US President Trump's meme coin $TRUMP to illustrate the valuation issues of cryptocurrencies. Dorman pointed out that $TRUMP initially had only social value, which later increased through hosting exclusive dinners, adding practical value. Although XRP has a market capitalization of approximately 150 billion USD, it mainly relies on social value and lacks actual financial utility.

Potential Impact: Dorman believes XRP may increase its practical value in the future through Ripple's launch of the US dollar-pegged stablecoin Ripple USD (RLUSD) and potential acquisition of stablecoin issuer Circle. Additionally, Ripple holds a large amount of XRP and has the capability to acquire other crypto companies.

Special Note: The summary retains information related to SoSoValue.

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Ripple-promoted cryptocurrency XRP is often touted as a game-changer for payments and cross-border transactions.The CIO of crypto hedge fund Arca, however, has questioned the financial utility of XRP.“XRP Has No Financial Utility”Jeff Dorman, the CIO of Arca, hasdismissively describedXRP as a “meme coin.”To back his assertion, the crypto hedge funder cited U.S. President Donald Trump’s meme coin, $TRUMP, as the perfect token to understand crypto valuations. Dorman noted that the $TRUMP token had only the “social” value upon itslaunch, as there were no cash flows, and users could not do anything with the token.However, the game changed after the team behind the meme coinannouncedthat President Trump is set to host an exclusive gala dinner at the Trump National Golf Club in Washington, D.C., for top $TRUMP holders on May 22. Dorman argues that the dinner feature added utility value to the Solana-based meme coin.Meanwhile, he thinks XRP has no utility or financial value despite being one of the top 10 cryptocurrencies by market cap. According to the Arca exec, XRP’s market cap has soared to around $150 billion, mainly due to social value.But it’s not all doom and gloom for XRP. Dorman says XRP’s social value has become so big that the payments token may add utility due to Ripple’s dollar-pegged stablecoin, Ripple USD (RLUSD), which wasdeployedon the company’s institution-focused XRP Ledger and Ethereum blockchain in December 2024.“Social value is real, but quantifying that value is impossible. Utility value is a little easier to measure, but still hard. When a token is useful, you can estimate how much it’s worth to use, and therefore estimate demand,” Dorman explained.XRP could also add financial value in the future through acquisitions, for instance, if Ripple purchases stablecoin issuer Circle. Reports late last month indicated that Ripplebid up to $5 billionas part of an attempted takeover of Circle, which was rejected as being too low.Bitwise president Teddy Fusarosuggestedat the time that Ripple could buy a lot of crypto companies if they wanted, as the company currently holds over $93 billion in XRP.

Head of Crypto Hedge Fund Questions Ripple's XRP as a Meme Coin with No Practical Value