With pressure mounting across global markets, Digital Ascension Group (DAG) CEO Zack Rector has suggested that XRP could benefit from an impending liquidity unlock.
in a recent video ExplanationThe Chancellor explained how major changes in financial infrastructure could free up trillions of dollars trapped within the banking system. He said these changes could put XRP in an advantageous position as financial institutions push for faster, cheaper and more efficient payments.
$27 trillion tied up in legacy banking
It is noteworthy that the president asserted that the global financial system remains sound. depends Regarding outdated frameworks that delay payments. increase Reduce transaction costs and leave huge capital behind sitting idle instead flows Through the economy. He cited the SWIFT network as one of the main causes of cross-border payment inefficiencies.
market experts pointed out Banks rely on your account with us to completion international trade, force to them confine Estimated $27 trillion to maintain worldwide Liquidity. This delays payments, increases costs, and limits the capital available for loans and investments.
he also ISO20022achieved full implementation last month. He acknowledged that the new standards have improved communication between financial institutions, but noted that they do not solve payment delays. Instead, he called it a foundation for future real-time payments rather than a complete solution.
Why stablecoins aren’t good enough for institutional investors
Additionally, speakers pushed back against the idea that stablecoins can solve these global payments challenges on their own.
“Stablecoins aren’t really even for the public. I think that’s a misconception that a lot of people have, because they’re using USDC and Tether, and they’re both debt.” he said:
He said banks are designing the most things. stable coin For internal use within a closed, authorized system. As a result, financial institutions will remain reluctant to hold stablecoins issued by other banks due to counterparty risk and balance sheet considerations. concerns.
He said a heavy reliance on stablecoins could deepen liquidity fragmentation. Specifically, banks will have to manage multiple digital debts from different issuers, replicating the same inefficiencies that the industry is trying to eliminate.
XRP exists as a neutral payment bridge
the principal was called XRP is a neutral asset This allows you to move value between financial institutions without the need for pre-funded accounts or other banks’ balance sheets. He highlighted the company’s ability to settle trades in seconds at low cost, while avoiding jurisdictional and counterparty risks.
“This is where XRP shines.” the principal said. “This will be a universal payment layer between all intermediaries, institutions and businesses. Bank for backend payments between infrastructures. ”
He also highlighted the XRP Ledger’s track record, noting that the network has been operating for over 10 years without extended downtime.
Rector said the bank has already extensively tested the ledger for back-end payments and interoperability. This helped prove its role in institutional finance rather than everyday consumer payments.
Meanwhile, Rector said that instead of adopting mass-market stablecoins, banks are likely to issue tokenized deposits or on-chain money market products. for example, JP Morgan recently launched The first money market fund Ethereummeters.
It is worth noting that these tools allow to bank keep The government bond yield is give a presentation customer and Interest-bearing digital deposits that settle instantly.
He noted that regulations prevent stablecoin issuers from passing on Treasury profits to holders, limiting their appeal to consumers.
but, tokenized deposits Banks can pay interest while enabling real-time transfers and programmable features. As adoption progresses, XRP has the potential to move value between institutions based on liquidity availability and transaction efficiency, Chancellor said.
Market reset and switch to digital rail looms approaching
He also warned of a general market reset due to high interest rates, excessive leverage, demographic pressures and rising debt levels. He said stocks, bonds, real estate, commodities and derivatives could all see big gains as the market unwinds.
Despite these risks, the chancellor suggested that the reset is a transition, not a disruption. He said governments will need real-time payment systems, shared ledgers and programmable funds to restore stability.
According to him, blockchain-based digital rails make it easier to implement Stimulus distribution, tax collection, and liquidity management in the next phase of the global economy.
Meanwhile, the President emphasized the increasing role of universities. Automated Market Maker (AMM) on networks like the XRP Ledger. He said AMMs tighten spreads, reduce arbitrage, close liquidity gaps and stabilize prices through automatic rebalancing.
Amid increased automation, Rector expects markets to become more stable and rooted in fundamentals. He believes this change will reduce the extreme volatility and limit the large opportunities that defined earlier market cycles.
Rector concluded that markets will move toward long-term efficiency if tokenization, real-time payments, and automated liquidity become the norm. In such an environment, stable profits would replace speculative profits. he said XRP Financial institutions are likely to benefit as they adopt a more efficient and fully digital global financial system.
