As more stable currencies, central bank digital currencies and tokenized assets enter the chain market, how cross-asset liquidity is organized is becoming a reality at the infrastructure level. According to the company, RippleX is continuing to promote the location of XRP as a bridging asset, hoping to connect more digital assets with fewer transactions.

50 assets correspond to two options

The company disclosed that the RippleX product owner, Jazzi Cooper, had recently presented an internal model of the team. The model compares two types of liquidity organization: the establishment of direct trade pairs between different assets and the conversion of assets through XRP as an intermediate bridge.

According to her calculations, if there were 50 different assets in the market and each asset required liquidity directly with other assets, a total of 1225 transactions would be required. The number of transactions required could be reduced to 50 if XRP were to be converted to a unified bridge.

  • Direct pairing mode: 50 assets correspond to 1225 transactions
  • XRP Bridge Mode: Only 50 transactions are required in the same scenario
  • RippleX measure: capital efficiency increased approximately 15 times

The demand for the bridge has risen with the increase in the amount of the currency.

RippleX accordingly claims that the capital efficiency of this model is about 15 times that of the two or two straight-link model. Cooper believes that as the number of chained assets continues to increase, the value of bridged assets will become more evident.

She also mentioned that similar issues had previously been discussed by IMF. According to her, if in the future different countries introduced their own digital currencies, the creation of separate direct trade pairs for each currency would be limited in scope. The role of bridging assets is to allow different assets to be connected through a single intermediary.

RippleX advances lending and collateral use

In addition to cross-border payments, the company claims that RippleX is promoting more use of XRP in institutional finance. Cooper states that the team is trying to introduce the loan agreement into XRP Ledger, so that the holder can participate in lending in addition to holding the currency.

She also anticipated that as institutions adopted products such as Ripple Prime and continued to expand sector-based financial services, the use of XRP in collateral scenes could increase. In the longer term, the XRP may also take on more protocol incentives and network function support roles within the XRP Ledger ecology.

Additional information:The text “15 times capital efficiency” is derived from the RippleX team model and does not disclose specific test parameters, market depth assumptions and external independent validation results.