tl;dr
The U.S. Federal Reserve's adoption of the ISO 20022 payment messaging standard marks a major upgrade in the payment industry, with Ripple's XRP token positioned to benefit significantly. ISO 20022 enhances data richness, efficiency, and interoperability, and Ripple’s early alignment with the standa...
As the U.S. Federal Reserve prepares to upgrade its payment system by adopting ISO 20022, industry insiders are focusing on Ripple’s native XRP token. The transition to ISO 20022 for Fedwire, going live today, is being hailed as the most significant payments event in decades, with analysts suggesting XRP is uniquely positioned to benefit from this change.
ISO 20022 is a global standard for financial messaging that offers richer data, improved efficiency, and enhanced interoperability compared to older systems. The Federal Reserve Financial Services confirmed its adoption in the U.S. on July 1, following similar moves by global payment networks such as SWIFT. Experts like Booshan Rengachari, CEO of Finzly, have called this shift “a massive upgrade for the entire payment industry.”
While the implementation itself does not explicitly mention cryptocurrencies, Ripple’s long-standing alignment with ISO 20022 has drawn attention. Ripple became the first distributed ledger operator to join the ISO 20022 standard body in May 2020, setting the stage for integration. Additionally, Ripple’s partnerships with Volante Technologies—a key player in the Fedwire ecosystem—allow institutions using Volante’s cloud-based Fedwire-as-a-Service platform to settle transactions using XRP through RippleNet, established in 2015.
The enormous transaction volume expected on the ISO 20022-enabled Fedwire system creates fertile ground for blockchain-based settlement solutions like those from Ripple and Volante. Market observers highlight that “quadrillions” could flow into XRP as a result, reflecting the immense potential despite some speculation. The existing infrastructure now supports serious institutional experimentation with XRP-driven settlements.
Ripple is also strengthening its institutional strategy amid the Fed’s adoption of ISO 20022. The company has applied for a U.S. national banking license through its subsidiary Standard Custody, which would place it under federal and state oversight, enhancing its credibility. Ripple has requested a Federal Reserve Master Account to hold reserves for its NYDFS-approved RLUSD stablecoin, a dollar-pegged asset designed for enterprise cross-border payments and currently custodied by BNY Mellon, the oldest U.S. bank. RLUSD boasts a market cap exceeding $500 million.
Additionally, Ripple’s recent acquisition of Hidden Road has initiated OTC swaps for U.S. institutions, suggesting a move toward becoming a comprehensive institutional liquidity provider. In terms of market performance, XRP has shown strong momentum, rising 5.1% in the last 24 hours and nearly 29% over the past week. Over the past year, XRP surged by 416%, now trading just 14% below its 2018 all-time high of $3.40.