Ripples seem to be bootstrapped in that you have to have them to pay a transaction fee for a ripple transaction. That's it. All it's used for. Current transaction fee for a Ripple transaction is 1/10,000 of a ripple.
So, you need 300 ripples to start an account (why so many?) and 1 ripple for all the transactions you will be doing. Until there is sufficient transaction load to cause a higher transaction fee.
Am I missing something? I don't understand paying BTC for them at this point.
This is similar to what I'm understanding. It seems that the XRP are mostly for spam prevention. XRP seem to be valuable to people who want to play with the system now before it matures, and nearly worthless to people who got them for free and don't really care about playing with it at the moment when they can buy in later.
I sold a lot of XRP because I fall in the later camp and someone bought my XRP because they fall in the former camp. I don't think XRP can be a bitcoin competitor, but they might be very useful for off-chain transactions in the future. It simply matters where you see your use of RIpple in the future.
People are confusing XRP (ripples) with Ripple. All you need are a few XRP to use Ripple (300 to get started and 0.00...01 to make a transaction. ie they are not used as a store of value.
It looks like they have been intentionally designed as a bad investment to discourage people using them as a store of value.
The value of the Ripple network is not connected to the Market Cap of the value of XRP since you can still make ripple transactions even if they are worthless.