During the past year, cryptocurrency investors have taken a particular liking to opportunities beyond mainstream choices like Bitcoin and Ethereum.

Two cryptocurrencies that stand out to me are XRP (XRP -2.90%) and Dogecoin. Below, I'll assess what's been driving each of these cryptocurrencies and explore why one of them looks like the better buy.

During the past year, cryptocurrency investors have taken a particular liking to opportunities beyond mainstream choices like Bitcoin (BTC -0.48%) and Ethereum (ETH -0.37%).

Two cryptocurrencies that stand out to me are XRP (XRP -2.90%) and Dogecoin (CRYPTO:DOGE). Below, I'll assess what's been driving each of these cryptocurrencies and explore why one of them looks like the better buy.

Taking a look at XRPAfter the U.S. presidential election, investors began to notice a shift in cryptocurrency prices. As a candidate, Donald Trump had been a vocal supporter of crypto, and after his election win it became clear that pro-crypto leadership was on its way to the Securities and Exchange Commission (SEC).

The SEC had been involved with a years-long lawsuit against cryptocurrency company Ripple (XRP -2.90%)—which had set out to disrupt the financial transaction systems used today. As a result of the candidates' stance on crypto, as well as the leadership changes at the SEC, many believed that the agency's case against Ripple would be dropped by the time Trump took office.

Now, if you aren't familiar with XRP, you may recognize the company behind it. XRP was developed as a means to facilitate financial transactions similar to what the Society for Worldwide Interbank Financial Telecommunication (SWIFT) does. The central appeal of XRP is that it can complete cross-border transactions more efficiently (i.e., faster and cheaper) than the legacy SWIFT system.

Although the appearance of disruptive, potentially superior technology might capture your interest, XRP's utility isn't much of a driving force.

XRP Price Data by YCharts

As you can see above, the price of XRP began to surge noticeably around November 2024, after Trump won the presidential election and before he took office.

If you’re wondering what drove this surge in XRP's price, it had less to do with anything related to the cryptocurrency itself and more to do with the political climate at the time.

As I mentioned earlier, Trump's administration was largely viewed as being more favorable toward cryptocurrencies than the prior administration. After Trump's inauguration in mid-January, XRP experienced another jolt. Finally, earlier this month, the SEC dropped its suit against Ripple—as the XRP bulls had been anticipating.

The second notable surge in XRP occurred during mid-January, after Trump's inauguration. Finally, earlier this month, the SEC dropped its suit against Ripple—as the XRP bulls had been anticipating.

Taking a look at DogecoinIn a similar fashion to XRP, the price of Dogecoin (CRYPTO:DOGE) kicked into a new gear after the election. In my eyes, the rising popularity in Dogecoin around this time was not coincidental.

Dogecoin Price Data by YCharts

As a result of Trump's victory, Tesla (NASDAQ:TSLA) Chief Executive Officer Elon Musk was chosen to lead a new federal project called the Department of Government Efficiency (DOGE).

My suspicion is that some investors found it humorous that the DOGE moniker shares the same ticker as Dogecoin, and as such, a narrative began. More specifically, I think investors bought into the idea that Dogecoin may be somehow officially endorsed, given its shared abbreviation with DOGE.

However, the chart above clearly illustrates that Dogecoin's price has been on the decline since December. In my view, this sell-off is just beginning.

I think investors have largely realized that Dogecoin is a meme coin and that it does not have utility the same way as Bitcoin or Ethereum. Moreover, DOGE does not appear to be involved or utilizing anything related to Dogecoin specifically.

Final verdictI think the sell-off in Dogecoin is just getting started, and smart investors are best off avoiding investing in narratives supported by memes.

With that said, XRP isn't as mainstream as legacy financial transaction systems. As I analyzed above, XRP's price increases have largely been tied to bullish narratives around the Trump administration and its stance on crypto as a whole, as well as the positive news out of the SEC. In other words, XRP's price is not rising due to much in the way of Ripple's business fundamentals or notable adoption of the XRP technology.

Even so, I am cautiously optimistic that 2025 could be a transformative year for XRP as the trepidation around the SEC and its decisions pertaining to Ripple should subside. Although this could be a bullish indicator for XRP's adoption in the long run, investors are going to need to exercise some patience. Ultimately, I see an investment in XRP as the clear choice in this analysis but would caution investors against buying into the idea that it will turn into a multibagger overnight.