Traditional finance (TradFi) companies are now embracing the concept of tokenizing financial assets on public blockchains as the competition for blockchain-based tokenization intensifies. According to RippleX senior vice president Markus Infanger, TradFi players are starting to bring financial assets onto the blockchain to address pain points in various value chains. In an exclusive interview with Cointelegraph during Paris Blockchain Week, Infanger stated that blockchain technology is finally becoming tangible for TradFi. He believes that this marks a paradigm shift for blockchain, moving beyond the hype and into practical applications. Infanger also mentioned that research estimates suggest the future value of tokenized markets could reach $16 trillion, which is eight times larger than the entire cryptocurrency sector’s market capitalization. He revealed that Ripple has been engaged in advanced conversations with financial institutions about tokenization projects on the XRP Ledger, and these firms already have distribution plans in place and can articulate how they intend to use the underlying blockchain. One example of this is HSBC’s partnership with Ripple-owned firm Metaco, which allows institutional investors to hold tokenized securities on a new custody platform. Infanger emphasized that Ripple’s business is evolving to offer more holistic solutions that leverage XRPL. While Ripple is primarily known as a payment-focused company, recent developments have expanded its appeal to both TradFi and decentralized finance (DeFi) players. Infanger explained that Ripple now has a custody arm, a payments arm, and contributions to the XRP Ledger, making it a comprehensive digital asset infrastructure for traditional finance and developers seeking to address DeFi challenges. In addition, Ripple recently announced plans to launch its own stablecoin pegged to the United States dollar on both XRPL and Ethereum, which will complement its existing offerings for institutions. Infanger noted that the stablecoin market has significant growth potential, with an expected trajectory to reach $2.8 trillion in five years. He stated that there is clear demand for stablecoins, as approximately $22 trillion is currently off-chain. Infanger also mentioned that developers in the XRPL ecosystem have consistently requested a tier-one stablecoin like USD Coin (USDC) or Tether (USDT), which drove Ripple’s decision to develop its own stablecoin. However, Ripple has not yet announced a launch date or the name of the XRPL and Ethereum-based stablecoin.
RippleX VP predicts public blockchains could witness a staggering $16T surge in the tokenized asset market