With the implementation of ISO 20022 for the Fedwire system, analysts are turning their attention to the potential of Ripple's XRP token. This event is seen as one of the most significant in the payment industry.
The ISO 20022 Revolution and Ripple's Integration
ISO 20022 serves as a global standard for financial messaging, providing richer data, enhanced efficiency, and better interoperability compared to older systems. The U.S. Federal Reserve officially confirmed adoption on July 1.
Booshan Rengachari, CEO of banking infrastructure provider Finzly, remarked, "this is a massive upgrade for the entire payment industry."
The need for Ripple's integration with ISO 20022 became clear when the company became the first distributed ledger operator to join the ISO 20022 standard body in May 2020. The optimism is further fueled by Ripple's partnership with Volante Technologies, which confirmed its platform will enable settlement using XRP.
Ripple's Institutional Strategy
The Fed's ISO 20022 implementation coincides with Ripple ramping up its institutional efforts by applying for a U.S. national banking license through its subsidiary, Standard Custody. If approved, this would significantly boost its credibility.
Additionally, Ripple has requested a Federal Reserve Master Account, allowing it to hold reserves for its dollar-pegged RLUSD stablecoin directly with the Fed. This asset is designed for enterprise utility in cross-border payments.
Current Market Status of XRP
Currently, XRP is also experiencing gains in the market. At the time of writing, the asset is up 5.1% in the last 24 hours, and nearly 29% over the previous week. With a 416% increase over the past year, the token is now just 14% away from its all-time high of $3.40 set in 2018.
The Fed's transition to ISO 20022 marks a significant event for the payment system, and XRP may find itself in a position to leverage its existing partnerships and technologies to capitalize on new market opportunities.
