Is Google Working on a Project to Rival XRP?

If you are considering putting your money into XRP ( XRP -1.28%), it’s important to keep an eye on developments in Silicon Valley. At the end of August, Alphabet ( GOOG 1.04%) ( GOOGL 1.13%) unveiled a fresh blockchain initiative named Google Cloud Universal Ledger (GCUL), which some are already calling a possible rival to XRP.

But is this really a threat? Here’s what you should know about Google’s new venture and its possible implications for the price of XRP.

What is Google Cloud Universal Ledger?

The Google Cloud Universal Ledger (GCUL) is a first-layer blockchain, similar to the XRP Ledger (XRPL), which operates using XRP. Like the XRP Ledger, GCUL is designed with the goal of enabling cross-border transactions between banks and other financial entities.

Google’s blockchain could also be used for purposes such as asset tokenization and settling transactions, but its main competition with XRP will likely be in the field of international payments.

In general, sending funds across borders via blockchain is quicker, simpler, and less expensive than using traditional systems. Rather than waiting days for a transaction to complete, banks can achieve almost instant settlement at a much lower cost. This creates a massive opportunity for anyone who can provide the best solution.

Currently, GCUL is undergoing beta testing and isn’t expected to launch before 2026. This gives Ripple—the company behind the XRP token—time to respond to this emerging competition. The advantage for Ripple is that the XRP Ledger has been operating for over ten years and has proven its capability to facilitate international money transfers using distributed ledger technology.

Major distinctions

While both GCUL and the XRP Ledger utilize blockchain technology, there are significant differences between them. For instance, Google’s blockchain is a private, permissioned network, whereas the XRP Ledger is a public, permissionless one. This means that while anyone can access the XRP Ledger, the Google blockchain is restricted to approved participants.

Historically, banks and other financial players have often favored private, permissioned blockchains due to lower risks and liabilities. The prospect of placing sensitive payment data on a public blockchain is understandably daunting for many in finance. This perception could give Google’s network an initial advantage if it is seen as a safer alternative.

Another difference is that Google’s blockchain does not currently have its own token. Although Google could introduce one in the future, you can’t presently invest in something like Google Coin. Instead, Google’s platform may use stablecoins or other tokens issued by financial institutions to move value.

This might seem minor at first glance, but given the high volatility in cryptocurrency prices, it’s significant. The value of XRP can fluctuate considerably over short periods. So, when using XRP as an intermediary for transferring value between parties, there is a clear element of risk.

In this respect, stablecoins—which are pegged to the U.S. dollar—offer a clear advantage. Their value remains steady at $1 (at least in theory), so there’s no need to worry about price swings. This could also work in Google’s favor.

What does this mean for XRP?

The so-called Google XRP killer is intriguing because it shows how the lines are blurring between tech companies, financial institutions, and blockchain projects. The convergence of Web3, fintech, and crypto is producing innovations that reduce costs, improve transparency, and speed up transactions for users.

Even if Google’s new blockchain doesn’t last long-term, its introduction highlights the potential risks associated with holding XRP. The worth of XRP is closely connected to the usefulness of its underlying blockchain. If new technologies begin to undermine that usefulness, holders may start offloading their XRP holdings.

Ultimately, Ripple still benefits from being an early mover in this space. It’s possible Ripple will find ways to outmaneuver Google and strengthen XRP’s value. However, I’m personally reducing my optimism for XRP’s long-term prospects. If you previously expected XRP to multiply in value over the coming years, you may want to reconsider those expectations as well.