Ripple, the blockchain payments giant, is making waves once again—this time by shaking up how development on the XRP Ledger is funded and by rolling out new privacy features aimed at attracting institutional users. The moves come as both XRP and Ethereum, two of the world’s most established cryptocurrencies, find themselves at a crossroads: how to grow, adapt, and win investor confidence amid fierce competition and evolving regulatory demands.
On February 27, 2026, Ripple announced a major shift in its approach to supporting developers building on the XRP Ledger. For years, Ripple has been the primary backer of the ecosystem, funnelling money and resources to projects it deems promising. But now, the $40 billion firm is opening the gates, aiming for a more distributed funding model that puts power in the hands of independent organizations, venture partners, and community-led initiatives. According to a company blog post, “As the ecosystem matures, the focus is shifting toward expanding access to funding through more distributed and independent pathways so builders have multiple avenues to scale.”
This isn’t just a matter of spreading the wealth. Ripple’s goal is to create a healthier, more resilient ecosystem—one where no single entity, not even Ripple, acts as the gatekeeper. The company’s own numbers underscore just how much sway it’s had: as of March 2025, Ripple still held $57 billion worth of XRP, which amounts to roughly two-thirds of all tokens in circulation. That’s a staggering figure and one that has long fueled debate about Ripple’s influence over the ledger it helped create back in 2012. Most of the original creators of the XRP Ledger went on to found or join Ripple as executives, further blurring the lines between company and community.
To help diversify developer funding, Ripple is launching a new FinTech Builder Programme. The initiative is designed to support startups building financial applications on the XRP Ledger—think stablecoin payments, credit infrastructure, tokenisation, and regulated financial services. But Ripple isn’t going it alone. The company pointed to its network of university partnerships and venture capital backers, including Dragonfly Capital, Pantera, and Franklin Templeton, as key players in the new funding landscape. The XRPL Commons, a nonprofit dedicated to supporting XRP Ledger development, and XRP Asia, an initiative focused on developers in the Asia-Pacific region, will continue their work as well.
June 2025 saw the launch of XAO DAO, a decentralized autonomous organization (DAO) for the XRP Ledger. Its mission: boost community voices and foster rapid experimentation by distributing microgrant funding. “The goal is to ensure that no single organization becomes the sole gatekeeper for ecosystem support,” Ripple emphasized in its announcement.
Despite the XRP token’s massive $84 billion market cap, the XRP Ledger has faced some headwinds in the decentralized finance (DeFi) space. Since July 2025, deposits to XRP Ledger protocols have plummeted from a peak of $120 million to just $49 million by early 2026, according to DL News. The ledger’s DeFi ecosystem has struggled to keep pace with competitors like Ethereum, which boasts a sprawling DeFi network worth over $53 billion and a stablecoin base of $159 billion.
Leadership changes have also marked this period of transition. In October 2025, Ripple’s chief technical officer David Schwartz stepped down after 14 years, having played a pivotal role in bringing key DeFi features to the XRP Ledger—including a native automated market maker and programmable tokens. But the firm isn’t standing still. Ripple developers are now discussing the introduction of XRP staking, a feature that could give the DeFi ecosystem a much-needed boost. They’re also building the infrastructure for a lending market on the XRP Ledger, with the proposal entering validator voting on January 28, 2026. Approval requires an 80% supermajority among validators, underscoring the community’s growing role in governance.
Meanwhile, privacy is emerging as a central theme in the race for institutional adoption. As reported on February 28, 2026, Ripple is preparing to roll out a confidential transactions feature on the XRP Ledger in the coming months. The aim? To satisfy the sometimes contradictory demands of financial institutions, which require privacy to protect sensitive positions but also need to comply with regulatory transparency. The XRP Ledger already includes on-ledger identity verification tools, as well as streamlined know-your-customer (KYC) and anti-money-laundering (AML) checks. The addition of privacy features is expected to make the ledger even more attractive to banks, hedge funds, and other regulated entities.
“XRP wants to be a place for regulated financial operators to do business,” reported The Motley Fool. “That means, when it processes trade settlements or facilitates tokenized asset transfers for its target users in financial institutions, it must do so in a way that meets the highest regulatory compliance standards.” The confidential transaction upgrade is designed to strike a balance between privacy and oversight, giving institutions the confidence to use the ledger for sensitive operations without sacrificing compliance.
Ethereum, for its part, is also pursuing privacy upgrades. It has already implemented stealth addresses, which allow users to receive funds without directly linking transactions to their public identity. More privacy-preserving features are on Ethereum’s roadmap for the next few years. However, analysts argue that, unlike XRP, privacy isn’t a make-or-break feature for Ethereum’s broader strategy. Instead, Ethereum’s strength lies in its sheer versatility and proven ability to adapt. The network completed two major upgrades in 2025—the Pectra upgrade in May and the Fusaka upgrade in December—with two more slated for 2026. This culture of iterative improvement, combined with its deep capital reserves, makes Ethereum an appealing long-term bet for many investors.
So, which coin is the better buy for the long haul? According to a February 28, 2026 analysis, Ethereum’s broad base of capital and history of successful upgrades give it an edge in resilience and adaptability. “Ethereum’s ‘grizzled veteran’ reputation today stems from surviving numerous shifts in user demand patterns while maintaining a large on-chain capital pool and growing it all the while,” the analysis noted. XRP, by contrast, is seen as more narrowly focused, with its value tied closely to its utility in institutional finance and cross-border payments. While XRP Ledger includes features like authorized trust lines and token freezing to meet regulatory requirements, its growth depends on winning over financial institutions—a process that can be painstakingly slow.
Still, Ripple’s latest moves—diversifying funding, empowering the community, and adding privacy features—could help the XRP Ledger carve out a stronger position in the crypto ecosystem. The coming months will test whether these efforts are enough to reverse declining DeFi deposits and attract the institutional users Ripple has long sought.
As the blockchain world continues to evolve, the race between Ethereum and XRP is far from settled. Both are betting big on innovation, but only time will tell which approach will win out in the end.