The cryptocurrency sector has its fair share of odd tokens, from meme coins to lesser-known crypto brands tied to blockchains created for a specific, bespoke purpose. XRP falls into the latter category, but some recent regulatory developments have caught the attention of crypto investors. Some analysts believe XRP shows potential to be the next big thing in crypto, while others make a strong case for continued caution.

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What’s behind these two differing viewpoints, and what is the best advice for investors considering XRP? Here’s a look at the pros and cons, and a final word on whether XRP is a buy-and-hold or wait-and-see.

Both bitcoin and XRP are cryptocurrencies that operate on public ledgers, but were designed for very different purposes and use distinct blockchain technologies. While most cryptos rise and fall with bitcoin, XRP has the potential to uncouple its value from the larger crypto market.

Bitcoin (BTC) is primarily used by investors as a store of value due to the decentralized nature and fixed supply of BTC. Its slower, more energy-intensive proof-of-work mechanism is a sharp contrast to XRP, which was specifically designed for fast, low-cost, cross-border payments. While XRP is more centralized, the confederated consensus XRP uses to process transactions is not only much faster, but more affordable and with a smaller carbon footprint.

Those who make the case for a soaring XRP market point to use cases for the currency’s real-world utility. While many crypto tokens were created for sometimes vague purposes with uncertain end-use facility, XRP was created to solve a specific problem.

International payments are slow and expensive. Reliance on banking systems like SWIFT means cross-border payments transit through a string of networked banks, each of which might take days to process a transaction — and charge its own fee for the service, according to Stripe. XRP is intended to act as a bridge currency that gives financial institutions the ability to move money across international borders without the need for preexisting, already funded accounts.

The network that backs XRP has already formed global partnerships with banks and other payment providers who see promise in the token. This institutional backing gives the currency a higher level of credibility and wider adoption than other cryptocurrencies. This indicator of future utility could drive the cost of the currency higher, but none of this is news [3].