Ripple CTO Reinforces XRP’s Institutional Dominance Over RLUSD

Financial institutions continue to leverage XRP for cross-border payments despite the introduction of Ripple’s stablecoin offering. Ripple’s Chief Technology Officer, David Schwartz, recently clarified XRP’s enduring role in institutional finance. His statements address growing questions about whether RLUSD will replace XRP in Ripple’s payment ecosystem.

The CTO emphasized that XRP maintains unique advantages over RLUSD for specific institutional use cases. These advantages become most apparent in corridors where fiat currency pairings remain limited or nonexistent.

XRP Provides Critical Liquidity Bridging Capabilities

XRP is a neutral bridge in global markets, offering superior liquidity and exchangeability among institutions. This bridging function proves essential when financial institutions operate across markets without established fiat-to-fiat trading pairs.

RLUSD delivers fiat stability that appeals to institutions seeking dollar-denominated transactions. However, XRP offers something different. The digital asset enables seamless value transfer between disparate financial systems without requiring pre-existing currency relationships.

Schwartz highlighted how XRP’s liquidity network spans multiple jurisdictions and currencies. This network effect creates natural demand for XRP as institutions expand their cross-border operations. The token serves as a universal translator between different monetary systems.

Institutional XRP Activity Occurs Off-Chain for Compliance

Low on-chain transaction volume reflects institutional use of XRP off-chain for compliance reasons. Many observers mistake low blockchain activity for reduced institutional adoption. Schwartz clarified that compliance requirements drive institutions to conduct XRP transactions through permissioned channels.

Ripple’s Q1 report revealed a 30% to 40% decline in wallet creation and transaction volume in the first quarter. These metrics capture only public blockchain activity. They miss the substantial institutional activity occurring through private networks and traditional financial rails.

Financial institutions prioritize regulatory compliance over blockchain transparency. This preference pushes XRP transactions into private channels where institutions can maintain proper audit trails and meet reporting requirements.

Ripple Develops Permissioned XRP Infrastructure

Ripple develops permissioned realms to allow users to be verified on-chain. These new tools address regulatory demands while preserving XRP’s core functionality. The development represents Ripple’s response to institutional feedback about compliance needs.

Permissioned infrastructure enables institutions to verify identities and transactions without sacrificing transaction speed or cost efficiency. This approach satisfies regulatory requirements while maintaining XRP’s competitive advantages over traditional payment systems.

The new infrastructure could increase institutional engagement by resolving compliance concerns that previously limited adoption. Financial institutions gain access to XRP’s benefits without compromising their regulatory standing.

RLUSD Complements Rather Than Replaces XRP

Ripple has integrated RLUSD into its cross-border payments system called Ripple Payments, enabling select customers to improve their cross-border treasury operations. The integration demonstrates how both assets serve complementary roles within Ripple’s ecosystem.

RLUSD addresses specific use cases where dollar stability takes priority over bridging functionality. Corporate treasuries managing dollar-denominated flows benefit from RLUSD’s price stability. Meanwhile, XRP continues to handle complex multi-currency transactions requiring liquidity bridging.

Ripple is building around XRP and not replacing the coin with RLUSD in its cross-border payment solution. This strategy acknowledges that different institutional needs require different tools. Some situations demand stability while others require liquidity.

Market Positioning Strengthens XRP’s Institutional Appeal

According to recent statements from Ripple leadership, XRP cryptocurrency could account for 14% of cross-border payment volume. This projection reflects growing institutional adoption despite public blockchain metrics suggesting otherwise.

As of July 2025, XRP supports real-time settlement, cross-border remittances, and tokenized financial instruments. Ripple’s focus has shifted toward enterprise infrastructure that emphasizes compliance and interoperability.

Combining XRP and RLUSD creates a comprehensive toolkit for institutional cross-border payments. Each asset addresses specific institutional requirements while contributing to Ripple’s broader payment infrastructure.

Conclusion

Schwartz’s clarifications highlight XRP’s continuing relevance in institutional finance. The token’s bridging capabilities remain unmatched by stablecoins prioritizing price stability over liquidity provision. Financial institutions recognize this distinction and continue incorporating XRP into their payment strategies.

Institutions access blockchain benefits while meeting regulatory requirements through verified, auditable channels. XRP’s institutional role evolves alongside regulatory frameworks and market demands. The token adapts to serve institutional needs while maintaining advantages over traditional payment methods and competing digital assets.