Ripple contributed to a white paper commissioned by the Dubai Financial Services Authority (DFSA), which brings together perspectives and insights from multiple participants in the financial services ecosystem.
Ripple’s Managing Director for the Middle East and Africa, Reece Merrick, recently stated that he contributed to DFSA’s new publication, “Scaling Tokenization: The Road Ahead,” and co-signed it alongside leaders from BlackRock, Standard Chartered, and Robinhood.
This white paper examines the conditions that may facilitate the responsible expansion of tokenized financial assets and related market infrastructure, including developments within the Dubai International Financial Centre (DIFC).
Other participants, besides Merrick, include: Tony Ashraf, Head of Technology & Operations for the Middle East and Africa and Head of Digital Assets at BlackRock; Coy Garrison, Senior Director of Crypto Business and Deputy General Counsel at Robinhood; René Michau, Global Head of Digital Assets Advisory at Standard Chartered; Henson Orser, Founder and CEO of Soter Insure; and Herman Schueller, Director of Innovation and Technology Risk Regulation at DFSA.
Will the XRP Ledger benefit?
According to the DFSA report, the tokenization of traditional financial assets has the potential to become a significant development in mainstream financial markets, offering investors broader participation opportunities, increasing efficiency for issuers and intermediaries, and reducing risk in certain areas, particularly in settlement processes within the broader financial system.
Merrick shared his perspective, stating that the real change isn't just the growth in AUM from tokenized Treasuries and money market funds (MMFs), but their on-chain use as collateral in repurchase and margin trades without first redeeming them for cash. He noted that the repurchase market still processes trillions of dollars daily, creating significant potential for tokenization.
Merrick expects significant growth in this sector over the next 12 months and predicts that a substantial portion of it will occur on the XRP Ledger.
He said: “With a clear framework, institutional-grade custody, and trusted settlement assets like RLUSD, the UAE, DIFC, and Ripple are at the forefront of this next stage.”
Market projections for the future scale of tokenized assets vary widely. Citi Institute’s baseline scenario estimates that the global market for tokenized financial assets could reach $5.5 trillion by 2030. A report by Standard Chartered and Synpulse estimates that demand for tokenized assets could reach $30.1 trillion by 2034.