XRP is Ripple's native token. Its purpose is to provide fast, cost-effective cross-border payments. Banks around the world use it as a way to speed up international remittances. As more banks use Ripple's remittance technology, there's increasing demand for XRP, increasing its price.

There are risks that apply to all cryptocurrencies. The three main risks are volatility, security, and regulation. The only cryptocurrencies that don't suffer from volatility risks are stablecoins. Other cryptocurrencies are highly volatile, including XRP. Some cryptocurrencies also suffer from security risks such as protocol hacks. XRP has never experienced a security breach. The third threat is regulation. Because the crypto industry is mostly unregulated, this is a serious ongoing threat. The SEC, for example, is suing Ripple because they're claiming that XRP is a security and should be regulated as such.