Ripple Prime CEO Mike Higgins says XRP is set to play a bigger role in institutional finance.
He noted that the digital asset will be used as collateral alongside Bitcoin, Ethereum, stablecoins, and tokenized money market funds.
The comments were highlighted by community figure Eri, who shared excerpts from a recent podcast featuring Higgins.
Key Points
- XRP may serve as collateral alongside Bitcoin, Ethereum, stablecoins, and tokenized money funds in institutions.
- Ripple Prime CEO says markets are shifting toward a traditional finance structure with separate trading and custody roles.
- Institutions prefer custodians and triparty systems, avoiding direct asset storage on exchanges for better security.
- Tokenization could enable instant settlement, with assets like XRP serving trading, liquidity, and margin needs.
Institutions Moving Toward Traditional Finance Structure
During the discussion, Higgins explained how the crypto market is gradually evolving toward a structure that resembles traditional financial markets. Instead of exchanges handling everything themselves, different companies will manage trading, custody, brokerage, and settlement separately.
He said many institutions no longer want to hold their assets directly on exchanges. Instead, they prefer custodians and triparty systems that allow assets to be used as collateral without transferring ownership to the exchange.
XRP Mentioned Alongside Bitcoin and Ethereum
One of the key moments in the discussion came when Higgins described the types of assets institutions may use in future collateral and settlement systems. He stated:
“No, it’s Bitcoin, it’s Ethereum, it’s XRP, it’s stablecoins, it’s tokenized money market funds.”
According to Higgins, almost any valuable asset could eventually be tokenized and used for settlement, financing, and margin trading.
This means XRP may be used for more than speculation. Institutions could use it as collateral for margin requirements, settlement payments, and liquidity management.
Meanwhile, he added that the industry is still developing, but tokenization is expanding rapidly across global finance.
Ripple Sees Tokenization Reshaping Markets
Higgins also described a future in which tokenized assets can be used instantly in everyday transactions.
As an example, he said someone could someday buy a cappuccino at Starbucks using tokenized shares of NVIDIA stock, even on a Sunday when traditional markets are closed.
He explained that this would require instant settlement systems, real-time pricing, and advanced risk management tools.
Unlike traditional banking systems, blockchain networks and stablecoins can operate 24/7 without waiting for banking hours.
RLUSD Stablecoin Highlighted
Higgins also highlighted Ripple’s RLUSD stablecoin and how it could improve capital efficiency.
He said traders could use stablecoins to meet collateral calls instantly instead of waiting for banks to process transfers. This could lower risks and reduce the amount of upfront margin brokers require.
According to Higgins, faster settlement allows financial firms to move from “business days to calendar days.”
Ripple’s Hidden Road Deal
Higgins connected these ideas to Ripple’s acquisition of Hidden Road, which now operates as Ripple Prime. The company focuses on cross-margining between crypto spot markets, ETFs, futures, and options.
He noted that institutions are already using strategies involving spot Bitcoin, Bitcoin ETFs, and CME futures contracts, but better infrastructure is still needed to support efficient cross-market trading.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.