XRP News Today: XRP Positioning as Core Liquidity Layer in Tokenized Finance Era

John Squire, a financial commentator, recently asserted on X that “In a tokenized world, $XRP is the liquidity layer,” signaling a shift in how XRP is being perceived as a foundational element in tokenized finance [1]. Squire emphasizes that XRP is no longer just a speculative asset but is increasingly being positioned as a critical liquidity mechanism in the evolving blockchain-based financial system.

The tokenization of real-world assets such as bonds, currencies, and equities is accelerating, creating a demand for a universal liquidity bridge. According to Squire, XRP, through Ripple’s On-Demand Liquidity (ODL), is uniquely suited to fulfill this role. ODL has already demonstrated its value in cross-border payments by enabling transactions without the need for pre-funded accounts, which has been particularly beneficial in remittance corridors [1]. As tokenization expands, the need for such a liquidity layer becomes even more critical.

XRP’s growing institutional relevance is underscored by recent developments, including the tokenization of $280 million in digital commercial paper on the XRP Ledger (XRPL). This move reflects increasing institutional interest in using XRP for capital market activities, moving the asset beyond retail trading into more sophisticated financial applications [1].

Squire has also challenged the common assumption that XRP’s large market cap limits its potential for price appreciation. He points out that over 95% of XRP is held long-term or in escrow, which means that relatively small increases in demand can lead to significant price movements. Historical trends support this idea, with XRP showing sharp price increases during periods of heightened demand. Squire believes this dynamic will become more pronounced as tokenization adoption grows [1].

Looking ahead, Squire highlights XRP’s expanding utility in real-world tokenization use cases. Forecasts estimate that over $19 trillion in assets could be tokenized by 2033, creating a need for a robust and interoperable liquidity mechanism. XRP’s role in projects such as real estate tokenization and tokenized treasuries illustrates its increasing relevance. For example, Webus recently announced a $100 million initiative to incorporate XRP into its treasury reserves, underscoring continued institutional confidence in the asset [1].

Despite these advancements, regulatory hurdles remain a challenge. Ripple’s CTO, David Schwartz, has noted that the company cannot use the native decentralized exchange on the XRP Ledger due to compliance concerns. However, the concept of “permissioned domains”—private, compliant zones within the XRP Ledger—has been proposed as a solution to allow institutions to access liquidity without breaching regulatory boundaries. Squire views this as a key innovation that could help bridge the gap between decentralized infrastructure and institutional requirements [1].

As tokenization reshapes financial systems, Squire’s perspective positions XRP not just as a payment token but as a foundational liquidity layer in the tokenized economy. Its role in cross-border payments, institutional markets, and regulatory adaptation underscores its potential to become a core component of the next financial infrastructure era.

Source: [1] Pundit: XRP is the Liquidity in a Tokenized World (https://timestabloid.com/pundit-xrp-is-the-liquidity-in-a-tokenized-world/)