Ripple CEO Brad Garlinghouse has explained how XRP can facilitate cross-border payments between different currency pairs without routing transactions through the US dollar.
Speaking to Bloomberg TV, he said XRP’s low cost, scalability, and role as a neutral bridge asset could make it useful across international payment corridors, despite the dominance of dollar-backed stablecoins.
However, reactions to his remarks also raised questions about whether XRP’s use as a bridge asset necessarily translates into higher market demand and a rising token price.
Ripple CEO Brad Garlinghouse says XRP continues to serve as a bridge between currency pairs, avoiding conversion into and out of the US dollar.
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Garlinghouse Explains XRP’s Role Between Currency Pairs
Garlinghouse noted that the US dollar accounts for more than 90% of all stablecoins. However, he explained that relying predominantly on dollar-denominated assets does not necessarily provide the most efficient solution for transactions involving different national currencies.
“If you want to be a bridge asset between lots of different things, just being US dollar dominated, denominated, doesn’t actually solve that across different corridors,” he said.
According to Garlinghouse, XRP continues to serve as a bridge asset between currency pairs. Rather than routing payments through the US dollar, financial institutions can potentially use XRP to facilitate transfers between currencies.
He described this approach as an alternative to the traditional process of converting one currency into dollars before converting those dollars into the recipient’s currency.
Why Ripple Favors a Neutral Bridge Asset
Garlinghouse illustrated the existing payment process with a transaction between the Australian dollar and the Philippine peso. Historically, he explained, someone sending a wire payment between these currencies would typically route the transaction through the US dollar.
Using a single bridge asset could offer an alternative to that process. Garlinghouse said XRP’s low transaction costs and scalability make it suitable for connecting different payment corridors.
“Having a neutral bridge asset that’s very, very, very low cost and very scalable is something we think will continue to be appealing to different corridors, different currency pairs,” he stated.
RLUSD Raises Questions About XRP’s Long-Term Role
The comments also attracted criticism from some members of the XRP community, particularly regarding Ripple’s introduction of its RLUSD stablecoin.
One commenter, tesserACT36, noted that RLUSD undermined XRP’s original purpose. The commenter questioned why Ripple would introduce a dollar-pegged stablecoin if XRP was expected to reach substantially higher prices. The comment also suggested that RLUSD could compete with XRP for activity on the XRP Ledger.
However, RLUSD and XRP serve different functions. RLUSD maintains a stable value relative to the US dollar, while XRP can serve as a bridge asset between currencies. Their coexistence does not automatically mean that one must replace the other.
Does Bridge Asset Utility Guarantee Higher XRP Prices?
Another commenter, Fishy Catfish, challenged the assumption that XRP’s use in international payments would necessarily increase its price. The commenter argued that once sufficient liquidity exists, the same XRP can facilitate repeated transactions without requiring an equivalent increase in the total supply of tokens held by payment providers.
The criticism distinguishes transaction volume from investment demand. Although greater payment activity could increase XRP’s utility, it does not automatically establish that buyers will consistently outnumber sellers.
Garlinghouse’s remarks therefore explain the intended payment function of XRP, while leaving a separate question about how adoption might affect its market value. XRP’s long-term price performance will depend on market demand and other factors, rather than transaction utility alone.
Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are advised to conduct thorough research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.
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