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▲ XRP
Mike Higgins, CEO of Ripple Prime, stated that XRP could be used as collateral alongside Bitcoin (BTC) in institutional finance. As the cryptocurrency market is restructured into a structure similar to traditional finance, XRP can be used beyond a simple speculative asset for payments, liquidity, and margin operations.
CryptoBasic reported on May 11 (local time) that Higgins recently mentioned the direction of digital asset utilization in institutional finance on a podcast. These remarks gained attention when Eri, an XRP community figure, shared parts of the podcast. Higgins collectively mentioned Bitcoin, Ethereum (ETH), XRP, stablecoins, and tokenized money market funds as assets that institutions could use in future collateral and payment systems.
Higgins explained that the cryptocurrency market is gradually moving towards a structure resembling traditional financial markets. He stated that it is shifting away from the model where exchanges handle all functions—trading, custody, brokerage, and settlement—to a structure where each function is performed by a separate entity. He added that many institutions no longer wish to store assets directly on exchanges and prefer using a custodian and a tripartite system to utilize assets as collateral without transferring ownership to an exchange.
He described assets that could be used in institutional collateral and payment systems, mentioning Bitcoin, Ethereum, XRP, stablecoins, and tokenized money market funds. According to Higgins, almost any valuable asset could be tokenized in the future and used for payments, finance, and margin trading. In this scenario, XRP would not merely be an object for trading price volatility but could be used to meet margin requirements, process payments, and manage liquidity.
Higgins presented a future where tokenized assets could be used instantly in everyday transactions. He gave an example of buying coffee at Starbucks using tokenized shares of Nvidia stock even on a Sunday when traditional markets are closed. However, he explained that such a structure would require instant payment systems, real-time pricing, and advanced risk management tools. He also emphasized that blockchain networks and stablecoins can operate 24 hours a day without waiting for bank business hours.
Higgins also mentioned Ripple's RLUSD stablecoin as a means to increase capital efficiency. He explained that traders could instantly respond to collateral requests with stablecoins instead of waiting for bank transfer processing, thereby reducing risk and the size of upfront margin required by brokers. This analysis suggests that faster settlements allow financial firms to move from business-day processing to calendar-day processing.
Higgins linked this vision to Ripple's acquisition of Hidden Road. Hidden Road, now operating as Ripple Prime, focuses on supporting cross-margin between crypto spot markets and ETFs, futures, and options. He stated that institutions are already operating strategies using Bitcoin spot, Bitcoin ETFs, and CME futures contracts, and there is a need for better infrastructure to support efficient inter-market trading.
Fund flows are moving more selectively, centering on assets with confirmed strong demand. An analysis suggested that for Ethereum and altcoins to follow Bitcoin's trend, not only a cooling of the derivatives market but also sustained spot buying and capital inflows are necessary.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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