XRP exchange-traded funds (ETFs) have demonstrated remarkable performance, attracting over $1 billion in investment since their launch in November 2025.
However, despite strong inflows, some analysts believe this momentum may not be sustainable in the long term.
Brian Huang, co-founder of the investment platform Glider, stated that developer activity is the primary driver of growth in blockchain ecosystems. Referring to Andreessen Horowitz’s (a16z) “developer behavior” data, Huang noted that XRP has received almost no developer interest. “Investment is about growth potential. Developers are the ones who grow the ecosystem; without them, limited growth should be expected,” he commented.
However, the short-term performance of XRP ETFs has far outperformed their competitors. Since launching trading in mid-November, XRP ETFs have recorded net inflows every day except one, reaching a total of $1.2 billion, according to SoSoValue data. During the same period, Bitcoin ETFs experienced outflows of $2.4 billion, while Ethereum ETFs lost approximately $898 million.
A significant portion of the institutional interest is said to stem from Ripple’s regulatory compliance approach. Katherine Dowling, President of Bitcoin Standard Treasury Company, previously stated that XRP could be “one of the most profitable assets” if the Clarity Act passes. Dowling also argued that Ripple has recently taken significant steps in terms of business partnerships and funding.
In November, Ripple increased its valuation to $40 billion with a $500 million funding round that included Citadel Securities, Fortress, Pantera Capital, and Galaxy Digital. On the same day, the company announced a partnership with Mastercard and Gemini for stablecoin payments.
Huang’s main criticism is the lack of sufficient developer activity in the XRP ecosystem. He argues that the near absence of XRP in Andreessen Horowitz’s developer-focused data poses a risk to long-term value creation, and claims that institutional investors often don’t see XRP as a serious project.
Conversely, some market players believe that a strong developer ecosystem is not necessarily required for the success of an ETF. They argue that the decisive factor is a loyal community that believes in the asset and continues to invest in it.
At this point, the powerful investor community known as the “XRP Army” stands out. Despite Ripple’s years-long SEC lawsuit and regulatory uncertainties, this community, maintaining their commitment to XRP, is seen as one of the main drivers of ETF inflows. Bitwise CIO Matt Hougan previously stated, “XRP is generally underestimated in the cryptocurrency world. But what determines fund flows is a strong community willing to buy that asset, and the XRP Army is extremely bullish.”
*This is not investment advice.
