Ripple, a blockchain company and issuer of XRP, announced the launch of a permissioned decentralized exchange on the XRP Ledger, opening new opportunities for regulated financial institutions.
Creation of New Trading Space
The permissioned DEX redefines the concept of decentralized exchanges within the XRPL, focusing on limited-access participants. Developers can set up separate order books for XRP, stablecoins, or wrapped cryptocurrencies, accessible exclusively to whitelisted institutions. This setup allows institutional players to maintain market depth and transparency while adhering to regulatory requirements.
Prospects for Institutional Participants
Ripple highlighted that regulatory compliance issues were hindering DEX usage on the XRPL. The new model provides fast and cost-efficient transactions while retaining asset control thanks to the network’s distributed architecture. Potential use cases for the platform include stablecoin-to-fiat currency exchanges, cross-border B2B payments, contractor and payroll disbursements, and corporate treasury management.
The Future of Permissioned DEX Models
In the permissioned DEX model, each domain can support an unlimited number of trading pairs, but orders can only match within the same domain. This structure helps prevent volume dispersion, simplifies risk management, and optimizes capital utilization. Ripple believes that the widespread adoption of this model will significantly boost institutional cryptocurrency volume on the XRPL.
The launch of Ripple’s permissioned decentralized exchange marks an important step towards integrating financial institutions in the blockchain ecosystem and may significantly change the cryptocurrency market.
