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If a thriving blockchain ecosystem were a recipe, the ingredients would go something like this:

• One consensus mechanism

• Four DeFi apps*

• A driven founder/figurehead

• One native stablecoin (at least)

• Two legal entities (dev studio and foundation)

• One token bridge (minimum)

• Three terminally online reply guys

The secret ingredient would be one or more of the following: funding rounds, mid-cap memecoins, NFT collections, active VC funds and third-party validator clients.

*Minimum required DeFi apps: DEX w/ token launchpads, lending/collateralized debt, liquid staking, oracle

So, while there are now hundreds of smart contract platforms with halfway decent market capitalizations, not all are buzzing to quite the same degree as the majors — Ethereum, Solana and BNB.

Case in point: XRPL, which has all but $63 million TVL in its onchain apps. Ripple Labs is right now working hard on finishing its own recipe, more than 12 years after its launch.

Starting easy, XRPL does have the consensus mechanism, albeit without the usual staking or mining, instead relying on trusted validators. And it already has a few token bridges.

There are also two legal entities: the San Francisco-headquartered Ripple Labs and the Estonian non-profit XRP Ledger Foundation, which was recently rebranded to the Inclusive Financial Technology Foundation.

Ripple Labs CEO Brad Garlinghouse obviously ticks the box for driven founder-slash-figurehead.

As for the reply guys, David Schwartz, Ripple Labs’ long-serving CTO, has built a following on solid reply guy energy (check).

And anyone who has ever tweeted anything remotely critique-adjacent has likely been visited by the XRP Army — which together truly harnesses the power of much more than just two reply guys (check check).

That leaves the four DeFi apps and a native stablecoin. 

XRPL currently has four DeFi apps with 100 unique active wallets interacting with them daily right now — but three of them are DEXs and one is an NFT marketplace. As of last month, it does have a native oracle, which should help to attract builders.

And conveniently, XRPL is the exception to the rule (with no direct staking XRP as part of consensus), so it can do without the liquid staking app in any case.

The only ingredients then left are a bustling lending protocol and a native stablecoin.

Luckily, a stablecoin is very much on the way: Ripple USD (RLUSD), which the New York State Department of Financial Services just approved for offering.

It’ll be structured similarly to Circle’s USDT and Tether’s USDT, backed by cash and equivalents (mostly short-dated US Treasurys).

With XRPL so close to acquiring all the necessary ingredients to really pop, it’s no surprise then that DeFi veteran Robert Leshner is now open to backing projects building out the Ripple ecosystem via his fund (VC bonus point get!).

The pièce de résistance for XRPL would then be a roster of its own mid-cap memecoins, as is traditional fare. 

Like it or not, those are cooking too, although the biggest of which is an XRP Army-themed coin with a $45 million market cap (still too small). 

The bright side: Only $15 million in tokens were traded on XRPL in the past day. Should RLUSD find decent traction, watch that number only go up from here to fully round out the recipe. 

Bellisimo!

— David Canellis

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• Altcoins are working on a bounce as BTC and ETH trade about even for the day (BTC: $98,260; ETH: $3,720).

• Global stablecoin supplies are only $360 million away from breaking $200 billion for the first time ever, according to DeFiLlama.

• Base has set a new record for weekly stablecoin transfer volume above $167 billion, per Blockworks Research data. The week prior was also a record at almost $152 billion.

• Polymarket volume has risen since the election aftermath. $401.6 million was traded last week compared to $344 million in mid-November — a 17% jump.

• Over 127,000 addresses have claimed the Magic Eden (ME) airdrop, while the token itself has fallen 70% since listing.

🥲 Torn to pieces

Brutal week so far for altcoins.

In the stock market, you generally look for a Santa Claus rally at the end of December into early January as a nice, green way to close out the year and welcome a new chapter. 

Whether we could see a similar thing in crypto is still up in the air. Right now it’s looking iffy.

On the upside, altcoin leverage managed to hold through Dec. 5, but Monday saw the biggest daily long liquidation event since May 2021, as K33 analysts noted. Ouch. 

“Ever since the election, long bets have been rewarded. This dynamic allowed open interest to accumulate with a steadily growing long concentration. This growth is evident by looking at total open interest in altcoins relative to the total altcoin market cap,” they wrote. 

“This metric grew from 3.57% to 4.42% from the election until December 9, amidst a very high funding rate environment in December. [Monday’s] liquidation cascade saw altcoin leverage plunge by $12.8bn, reducing the relative altcoin leverage to 3.96%.”

To put those metrics into perspective, altcoin open interest marked the “biggest relative decline in altcoin leverage since the FTX collapse.”

BitOoda analysts, following Monday’s sell-off, said that they expect more “sideways trading through year-end marked by periods of low liquidity and choppy price action.” And we very well may see that given the highly leveraged products and “exaggerated” price action moves. 

The good news, however, is that while this is a decently sized bump in the road, it doesn’t sound like it’s impacting the bullish 2025 outlook shared lately by many. 

Perhaps there’s still hope for a Santa rally.

— Katherine Ross

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• MicroStrategy’s potential inclusion in the Nasdaq 100 could lead to more visibility, Bernstein analysts wrote. 

• Binance isn’t ready to discuss a potential return to the US just yet, according to CEO Richard Teng. 

• Magic Eden apparently had some technical difficulties with its ME airdrop. 

• After signing an agreement Tuesday, regulators from both El Salvador and Argentina are looking to help develop crypto in both countries — and Latin America.

• Circle and Binance announced a partnership in which the exchange will list more USDC pairs to accelerate growth.

Q: What can XRP do with all this momentum?

Keep on keeping on. 

Putting aside the sell-off in the broader altcoin landscape, XRP has opportunistically managed to snag the attention in the room. I can’t tell you how many stories I’ve read about the chart and where XRP goes from here. 

I think it doesn’t hurt that you have big announcements — like the stablecoin one mentioned by David — from Ripple, either. 

Though, let’s be real, this is a very crowded and competitive market. Look at PayPal’s PYUSD, which is still trying to compete against the titans that are Circle and Tether. We’ll just have to see how Ripple fares.

— Katherine Ross

Ripple Labs will really need to make sure that the network can withstand a huge jump in activity.

We know XRPL has struggled in the past during times of intensive use, alongside popular airdrops.

Outside of that, I’m not so sure it’s really up to Ripple Labs itself. Hyperliquid recently broke the mold of VC-funded token launches. 

But at this point, something tells me the Ripple ecosystem is going to need a string of hyper-dedicated funds capable of incubating world-class DeFi apps and infrastructure that can actually contend. 

— David Canellis