XRP News Today: Bank of America Values XRP for 60% Faster Cross-Border Payments

Bank of America (BoA) continues to value Ripple's XRP for cross-border payments, despite the rise of stablecoins. This commitment reflects the institutional belief in XRP's unique value proposition, particularly in terms of liquidity and regulatory certainty. The Director of the Digital Asset Group (DAG) emphasizes that while stablecoins are dominant in retail transactions, XRP remains indispensable for institutional settlement due to its speed and cost efficiency.

BoA's partnership with Ripple began in 2020 when it joined RippleNet, a cross-border payments network that uses XRP for on-demand liquidity (ODL). Unlike traditional SWIFT transfers, which can take days and incur high costs, BoA settles cross-border payments in seconds using XRP as a bridge currency. This has been particularly beneficial for BoA's corporate clients in sectors like manufacturing and logistics, where real-time settlement and transparency are crucial.

The DAG Director's report underscores a key distinction in crypto adoption: stablecoins like USDT and USDC are preferred for retail payments and decentralized finance (DeFi) due to their price stability, while XRP is favored for institutional settlement. XRP's 3-second finality and average fee of $0.0002 make it more competitive for high-volume transactions compared to stablecoins. Additionally, XRP's regulatory status in key jurisdictions like the U.K. and Japan provides operational certainty for banks like BoA, as stablecoins face increasing scrutiny.

BoA's integration of Ripple's ODL addresses specific high-impact use cases. For instance, suppliers of automotive components use ODL to pay foreign manufacturers, aligning payments with assembly-line timing. Corporates also convert idle fiat to XRP for 24/7 liquidity, reducing foreign-exchange reserves by up to 60%. A BoA client moving $50 million monthly via ODL saves approximately $120,000 in fees and $1.2 million in float cost annually.

The DAG Director notes that XRP's strength lies in its niche utility rather than direct competition with stablecoins. XRP's $2.5 billion daily volume enables instant large transfers without slippage. Ripple's partial legal win against the SEC provides banks with compliance confidence, and XRP's consensus mechanism uses 99% less energy than proof-of-work blockchains. This three-way synergy makes XRP essential for institutions, even as stablecoins gain traction in consumer markets.

As Ripple expands ODL corridors to over 40 countries and central banks consider XRP for CBDC interconnectivity, BoA's investment in XRP appears well-founded. The DAG Director also mentions that major banks like BBVA and Santander are increasing their adoption of ODL, and Ripple's new stablecoin (RLUSD) will complement, rather than replace, XRP's settling role. This indicates a coexistence rather than competition between XRP and stablecoins, with each serving different purposes in the crypto ecosystem.

For institutions requiring velocity, compliance, and scalability, XRP remains the backbone of global value transfer. This highlights the extent to which XRP's use extends beyond market speculation, demonstrating its practical applications in institutional finance.