According to Ripple’s head of Global Institutional Markets Breanne Madigan, new use cases for XRP that would not take place in the cross-border industry would allow XRP to increase its liquidity. She said that in a recent blog post released on the official Ripple page.
In this article, she wrote about how the coronavirus crisis has affected companies all over the world, similarly to what happened back in the 2008 financial crisis. She went on saying that XRP is the lifeblood of Ripple’s On-Demand Liquidity (ODL) product that can be used to process cross-border payments.
With the XRP cryptocurrency, it is possible to make transfers in a fast and easy way. This digital asset becomes then an intermediary between fiat currencies that do not have enough liquidity. At the moment, there are several financial institutions and payment providers using these solutions.
Breanne Madigan considers that as ODL volumes grow, institutional trading will also increase. This is due to ODL flows that tend to be dominated by institutional parties. Furthermore, she stated and suggested that the growth for XRP liquidity could also come from a wide range of sources rather than just firms using cross border solutions.
Finally, she mentioned that continuous utility will help foster liquidity depth and market health on XRP. The higher the value transfer the network processes, the easier it will be to solve payment frictions.