Traditional Finance Firms Advance Towards Tokenizing Assets on Public Blockchains: A RippleX Perspective
Summary:
Traditional finance firms are increasingly tokenizing financial assets on public blockchains, as noted by RippleX senior vice president, Markus Infanger. Several institutions are exploring tokenization projects on the XRP Ledger, extending Ripple's appeal to both traditional and decentralized finance sectors. Ripple plans to issue its own U.S. dollar stablecoin on XRPL and Ethereum to complement its institutional offerings, with the stablecoin market forecast to reach $2.8 trillion within five years.
The traditional finance realm is warming up to the concept of tokenizing their financial resources on public blockchains, leading to a surge in the move towards this innovative methodology. Markus Infanger, the senior vice president of RippleX, reveals that traditional finance entities are now tokenizing their fiscal assets on-chain. Their aim is to boost production and streamline different value chains. In an exclusive dialogue with Cointelegraph during the Paris Blockchain Week, Infanger mentioned that traditional finance sectors' foray into blockchain utilization is now gaining solid ground. This shift indicates that blockchain technology has moved beyond the excitement and into practical usage.
Experts anticipate the value of tokenized markets to skyrocket to $16 trillion in the future- a figure eight times larger than the combined market cap of the entire cryptocurrency segment. Infanger explained that several financial institutions are engaging in advanced talks and exploring opportunities to issue assets on the XRP Ledger. Some of these firms have a distribution plan ready and can put forth use cases about how they intend to employ the basic blockchain.
HSBC's collaboration with Metaco, a technology firm owned by Ripple, serves as an example of this. This partnership aided institutional investors in managing tokenized securities on Metaco's newly formed custody platform in November 2023. Infanger also mentioned Ripple's progress towards maintaining a more holistic perspective that includes multiple solutions using the XRPL. Ripple is popularly regarded as a payment-oriented company that provides a blockchain-based payment solution to rectify fiscal and economic friction. However, its latest initiatives are reaching out to traditional finance and decentralized finance players.
On a related note, Ripple's recent announcement about issuing its own U.S. dollar stablecoin on XRPL and Ethereum intends to augment its institutional offerings. The future market for stablecoins could touch $2.8 trillion, considering that about $22 trillion are off-chain. This, combined with the anticipation of rapid growth and consistent requests for a top-notch stablecoin offering, motivated Ripple's decision to launch a stablecoin. Ripple has not yet disclosed when it will roll out its stablecoin or the name for its XRPL and Ethereum-based token.
Published At
4/18/2024 12:31:58 PM
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