The Ripple Effect

The Ripple Effect - 10/3/25

XRP surges 4% to $3.05 as US government shutdown triggers crypto rally. Multiple spot ETF decisions loom Oct 18-25 with 95% approval odds. Jake Claver links the shutdown to a potential liquidity crisis, positioning XRP as a solution. RLUSD nears $800M market cap with UC Berkeley partnership.

The Ripple Effect

03 Oct 2025 — 5 min read

XRP surges amid US government shutdown as crypto markets rally on expectations of positive liquidity impacts and delayed economic data. With multiple spot ETF decisions looming October 18-25 and institutional adoption accelerating, XRP maintains strong momentum above $3 despite broader market uncertainty. Government shutdown adds complexity to regulatory timeline while influential voices like Jake Claver emphasize XRP's potential role in solving systemic liquidity challenges.

Market Update

XRP is trading at approximately $3.05, marking a 4.10% gain in the past 24 hours, as major cryptocurrencies including XRP gained 4-7% following the US government shutdown. XRP's market cap currently stands at $181.06 billion, ranking it as the fourth-largest cryptocurrency, with 24-hour trading volume spiking 14% to $5.73 billion.

Technical indicators show a bullish sentiment with the Fear & Greed Index at 64 (Greed), though XRP recorded 16 out of 30 green days over the last month with 3.48% price volatility. The price is positioned between support at $2.83 (100-day EMA) and resistance at $2.94 (50-day EMA), with the RSI at 44.59 showing weakening but not oversold momentum.

Key Developments

Government Shutdown Impact

Bitcoin and major altcoins including XRP surged as the US government officially shut down on Wednesday, October 2, with analysts suggesting the shutdown could delay key economic reports and lead to further Federal Reserve rate cuts. Economist Joe Brusuelas noted the biggest market outcomes could be further pressure on the US dollar or impact on the Fed's October rate decision, with potential for a 25 basis point cut despite limited labor market data.

Historical analysis reveals mixed results for XRP during government shutdowns - the token fell 12.8% during the 2018 three-day shutdown and 12.45% during the 35-day shutdown from December 2018 to January 2019. However, current market conditions differ significantly with the presence of ETFs, institutional adoption, and Ripple's legal clarity, potentially positioning XRP as a hedge against government dysfunction.

The shutdown threatens to delay the Senate's consideration of crypto market structure legislation, including the CLARITY Act, which was already pushed from September to October. Regulatory agencies like the SEC and CFTC will operate on skeleton crews, potentially delaying crypto ETF reviews and enforcement actions.

XRP ETF Approval Timeline

The SEC is expected to rule on multiple spot XRP ETF applications between October 18 and October 25, 2025, with Grayscale's decision deadline set for October 18. Applications from Grayscale, 21Shares, Bitwise, WisdomTree, Franklin Templeton, Canary Capital, and CoinShares are under review, with six deadlines falling within a single week in October.

Bloomberg analysts give XRP ETF approvals a 95% chance of success, with online prediction markets placing odds at 99%. The market anticipates a potential influx of $4-8 billion in institutional capital if approvals are granted.

The REX-Osprey XRP ETF (XRPR), which launched on September 18, 2025, attracted a massive $37.7 million in first-day trading volume - the highest for any ETF launch in 2025 and five times the debut volume of earlier XRP futures-based products. This marks the only approved XRP spot ETF as of September 28, 2025, with approval stemming from a combination of spot exposure and derivatives.

RLUSD Stablecoin Expansion

Ripple announced today that it is using its RLUSD stablecoin to finance the launch of the Berkeley Center for Digital Assets at UC Berkeley with a $1.3 million contribution. The center will focus on "digital twins" - blockchain-based models that replicate real-world assets from farmland to semiconductors.

Ripple minted an additional 1.8 million RLUSD tokens on the XRP Ledger on October 1, 2025, marking the first mint since September 24. RLUSD's market cap has surged to approximately $789.54 million, ranking it 92nd among cryptocurrencies, with 24-hour trading volume jumping 75%.

Ripple is expanding RLUSD into African markets through partnerships with Chipper Cash and Yellow Card to address expensive remittances, high inflation, and limited banking access. Despite initial positioning as enterprise-focused, over 90% of the 34,160 RLUSD holders are on the XRP Ledger, indicating significant retail adoption.

Notable Mentions

Jake Claver on Government Shutdown & Liquidity Crisis

Jake Claver, CEO of Digital Ascension Group, provided provocative commentary linking the government shutdown to potential systemic changes that could benefit XRP holders. In a recent X post, Claver stated: "How crazy would it be if the government shutdown causes the CLARITY act to get pushed out and XRP is the only option with Clarity here in the US when they need a crypto to solve the impending liquidity crisis from the reverse carry trade unwinding".

Claver has previously forecasted XRP could surge to $1,500-$2,000 by 2026, citing macroeconomic shifts including the unwinding of the reverse carry trade, regulatory scrutiny of Tether, and XRP's potential role as a neutral bridge asset in cross-platform finance. He emphasized XRP's 20-40 minute settlement speed compared to the stock market's one-day settlement, highlighting Project ION as infrastructure where XRP could serve as a bridge asset.

Claver recently stated that with ETF products now in play and spot XRP ETFs expected to launch with projections of $5 billion in investments flowing in within weeks, the market is unlikely to allow XRP to fall back to previous lows.

Speculative Analysis: Claver's theory suggests that if the government shutdown delays CLARITY Act passage while simultaneously creating liquidity stress from unwinding carry trades, XRP's existing regulatory clarity from the Ripple settlement could position it as the default solution. This remains highly speculative and depends on multiple complex macroeconomic factors converging.

Black Swan Capitalist on Debt Crisis

Versan Aljarrah, founder of Black Swan Capitalist, claims XRP could solve the global debt crisis through tokenization, stating, "Trillions in debt will be tokenized. But only XRP can unlock the liquidity trapped inside". His comments reference an IMF report estimating global debt holdings at roughly $251 trillion, or 235% of GDP.

Aljarrah argues that XRP holders are positioned to "control the new financial system" through tokenized ownership built on the XRP Ledger, particularly as RLUSD tokenizes securities. He highlighted the Bank for International Settlements' move to reclassify gold as a Tier 1 asset, suggesting governments could revalue and tokenize gold using technologies like XRPL.

Analysis: While Aljarrah's vision of XRP as central to a new tokenized financial system is ambitious, recent developments like Dubai's government-backed property tokenization initiative on XRP Ledger and Messari's Q1 2025 report showing XRP outperforming rivals in market cap and network growth provide some fundamental support.

Looking Ahead

Critical Dates:

October 10: VanEck XRP ETF filing decision window opens
October 18: Grayscale spot XRP ETF decision deadline
October 18-25: Multiple spot XRP ETF decision deadlines (21Shares, Bitwise, WisdomTree, Franklin Templeton)
November 14: Franklin Templeton extended deadline

Key Catalysts:

Resolution of government shutdown and impact on regulatory timeline
Federal Reserve October rate decision (potential 25bp cut)
CLARITY Act progression in Senate
Institutional ETF inflows if approvals granted

If approvals proceed as anticipated, XRP would have a legitimate chance of hitting a new all-time high above the $4 mark by year-end, particularly given October's historically bullish seasonality for crypto.

Sources

Disclaimer: This newsletter is for informational purposes only and does not constitute investment advice or a recommendation to buy, sell, or hold any securities. XRP and cryptocurrency investments carry significant risks including potential total loss, extreme volatility, and regulatory uncertainty. Past performance does not guarantee future results. Unless we have a formal advisory agreement, I am not acting as your investment adviser. Consult a qualified financial professional and conduct your own research before making investment decisions.