XRP vs Bitcoin: Could Ripple’s Tech Challenge BTC’s Dominance? | Crypto News
Cryptocurrency markets reacted to a Federal Reserve working paper released in February 2026 proposing a latest risk classification for digital assets, as leading cryptocurrencies experienced a downturn on Tuesday, February 17, 2026. Bitcoin slid to an intraday low of $66,600, while Ethereum struggled to maintain its position above $2,000 and XRP and Solana both recorded declines, according to reports from Benzinga.
The Federal Reserve’s proposal, detailed in the “Initial Margin for Crypto Currencies Risks in Uncleared Markets” document (FEDS 2026-009), suggests creating a dedicated risk class for cryptocurrencies within uncleared over-the-counter (OTC) derivatives markets. The paper specifically names Bitcoin, XRP, Binance-related tokens, and stablecoins as candidates for this specialized treatment, aiming to capture crypto-specific volatility patterns rather than applying traditional risk assessments designed for stocks or bonds.
The move comes as policymakers increasingly scrutinize the potential impact of digital assets on financial stability. A recent incident highlighted this concern when the trading desk at the Federal Reserve requested indicative dollar/yen quotes following a sharp move in the yen, a request prompted by Treasury officials seeking to monitor currency volatility. This event underscored the need for new tools to address rapidly shifting market dynamics.
Meanwhile, a bold claim from a longtime Bitcoin advocate, known as Pumpius on X, has reignited debate about the potential for XRP to surpass Bitcoin. Pumpius suggested that if central banks were to adopt a single on-chain bridge, XRP could “eclipse Bitcoin by magnitude.” This assertion centers on XRP’s design for speedy settlement and its potential role in facilitating near-instantaneous cross-border transactions.
Ripple, the company behind XRP, anticipates 2026 as a pivotal year for institutional adoption. Ripple President Monica Long has outlined scenarios where banks and asset managers could establish production systems linked to on-chain liquidity pools. The concept involves creating permissioned pools and utilizing regulated stablecoins to provide liquidity, with an on-chain order book or matching engine handling trades. Such a system could potentially reduce settlement times to seconds and provide automatic audit trails.
However, significant hurdles remain. Bitcoin’s market capitalization currently stands in the trillions of dollars, while XRP’s market value is under $100 billion. Bridging this gap would require substantial capital inflows into XRP, necessitating broad institutional participation and greater regulatory clarity. A comprehensive proposal from March 2025 details a strategic financial asset plan for XRP, including a mandate for its apply by banks to replace Nostro accounts, and a plan for a $1.5 trillion Bitcoin acquisition.
Geopolitical factors and policy shifts also contribute to market uncertainty. The presence of US President Donald Trump in debates over policy and geopolitical risk adds another layer of complexity, influencing capital flows and safe-haven asset demand. While faster settlement rails may appear attractive in such an environment, actual adoption remains contingent on navigating regulatory landscapes and addressing institutional concerns.
Roughly $200 million was liquidated from the crypto market in the 24 hours leading up to February 17, 2026, with $138 million attributed to long liquidations, according to Coinglass. Despite the price decline, retail and whale investors on Binance continued to show bullish sentiment towards Bitcoin, placing more long positions than short positions.