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- Ripple says that crypto exchanges must advance their services and products as crypto grows to include institutional crypto custody, tokenization, and cross-border payments.
- The firm offers products that exchanges can leverage to level up, including Ripple Custody, Ripple Payments, and the scalable XRP Ledger.
Crypto exchanges have been the nerve centre of the sector for years, availing thousands of digital assets to millions of traders. However, as the crypto industry grows, they must adapt and evolve to offer products more suited to the new era of crypto finance. Ripple says it has the infrastructure for these exchanges to advance their products, including the XRP Ledger, which they can use to cut costs and grow revenue.
In a blog post on Thursday, Ripple examined the role of exchanges and how it’s evolving as crypto ceases to be a niche sector for anarchists and technophiles. Today, exchanges are at the heart of use cases such as tokenization, which is estimated to be worth $16 trillion by the end of the decade.
Estimates suggest tokenization could reach $10T by 2030, and crypto exchanges must evolve for the digital asset economy.
How can they adapt?
🔐 Institutional-grade custody solutions
💱 Efficient cross-border payments
📊 Unlock revenue from tokenized assets
🛡️ Simplified…— Ripple (@Ripple) October 24, 2024
Ripple believes that it’s essential for exchanges to future-proof their businesses; the business models that minted them billions eight years ago—almost exclusively geared toward transaction fees—are no longer tenable as the industry evolves. Moreover, value in crypto is moving to other facets, and exchanges must serve these facets before other stakeholders fill the void.
One such facet is tokenization. Goldman Sachs has predicted that tokenization will be a $16 trillion opportunity by 2030. According to the California company, exchanges must “adapt and prepare for the inevitable shift to the digital asset economy. Through a combination of high-demand services like institutional digital asset custody and streamlined crypto off-ramps, providers can better balance current and future client needs.”
Ripple’s Solutions for Exchanges
Ripple offers a raft of solutions that cater to exchanges, it wrote in its blog post. One is Ripple Custody, which offers world-class security to exchanges, allowing them to facilitate trading, offer cold storage, and support new use cases with the guarantee that the user assets are safe and secure.
The product comes with a high degree of customization, offering users a flexible key management structure and enabling more autonomy.
“This enables exchanges to serve a wider range of customers — from those that are seeking long-term custody of digital assets to those that log high-frequency transactions — without compromising on security or compliance,” the company says.
Ripple Payments allows users to leverage blockchain technology for fast global transactions. Exchanges can integrate it to offer “real-time settlement, more affordable cross-border transactions, and dramatically improved transparency—all in a safe, secure and compliant way.”
All these solutions are tied together by XRP and the XRP Ledger.
By future-proofing their digital asset infrastructure, crypto exchanges also gain compelling business benefits. With Ripple solutions, exchanges can leverage the power of the XRP Ledger and its native digital asset XRP to lower transaction fees, cut compliance costs and grow revenue by unlocking new use cases.
XRP trades at $0.5249, trading marginally over the past day for a $29.79 billion market cap.
