XRP Emerges as the ‘New Cryptocurrency Darling’ Following a Strong Start to 2026

After a stellar performance in the early days of 2026, XRP has caught significant attention and is being referred to as a major trade opportunity in the cryptocurrency market. The altcoin's robust rally has positioned it as the third-largest cryptocurrency by market capitalization, surpassing its competitors during recent market volatility.

Key Takeaways

XRP's Performance: Cited as the "new cryptocurrency darling" of 2026 with over a 30% increase since the start of the year.
Market Position: Recently reclaimed its position as the third-largest cryptocurrency by market cap.
Underlying Factors: The rally is attributed to cleared regulatory challenges, a less competitive trading environment compared to Bitcoin and Ethereum, and strong investor interest.
Investor Behavior: XRP ETFs have seen significant inflows, highlighting persistent investor confidence.

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XRP: The Hottest Trade of the Year

Brian Sullivan from CNBC has praised XRP’s impressive performance, declaring it as the leading crypto investment of 2026. He emphasized during a Power Lunch segment that “the hottest crypto trade of the year is not Bitcoin, it is not Ether, it is XRP,” highlighting the significant capital backing this trade.

Sullivan outlined XRP's impressive seven-day rally that led to recent highs. Since the beginning of the year, XRP has surged over 30%, reaching a two-month high of $2.41 on Tuesday morning. This remarkable performance allowed XRP to once again surpass BNB, reclaiming its position as the third-largest cryptocurrency by market capitalization after losing it during December's market fluctuations.

Moreover, XRP has outperformed several major cryptocurrencies in the past week, including Bitcoin's 4.3% and Ethereum's 6.2% gains. CNBC's MacKenzie Sigalos added that “XRP has been the quiet outperformer for months now,” prompting speculation about whether XRP is becoming “the next cool thing to know about” in the crypto space, particularly for its vital role in facilitating cross-border payments.

What’s Fueling the Rally?

Sigalos identified three key factors driving XRP’s impressive start to 2026:

Regulatory Clarity: The prolonged legal battle with the SEC has been resolved as of August 2nd, providing a clear regulatory landscape for Ripple and XRP.
Less Competitive Environment: Investors view XRP as a "less crowded trade" than Bitcoin and Ether, which proved to be correct during the first trading days of January.
Strong Investor Demand: Despite the downturn in Q4, investor appetite for XRP remained robust. Unlike the trends seen with Bitcoin and Ether where investor movements are price-sensitive, many continued to invest in XRP ETFs, signifying a strategic choice for potentially higher gains.

Surprisingly, XRP ETFs have flourished since their launch in Q4 2025, with total net inflows reaching $1.25 billion, according to SoSoValue. Throughout nearly two months, the ETF category has not seen any day of negative net flows. Specifically, within just the first three days of the year, XRP funds have enjoyed net inflows totaling $78.81 million.

Currently, XRP is trading at $2.19, reflecting a 20% increase over the past week.

XRP, XRPUSDT
XRP’s weekly performance overview. Source: XRPUSDT on TradingView