Ripple Labs has introduced the first money market fund tokenized on the XRP Ledger (XRPL). the initiativein partnership with Archax and UK-based asset manager abrdn, demonstrates significant progress in tokenizing real-world assets (RWA) and expanding the institutional decentralized finance (DeFi) ecosystem of the XRP ledger.
Ripple enters the RWA sector
Archax, recognized as the first digital asset exchange, broker and depository regulated by the Financial Conduct Authority (FCA), has facilitated access to abrdn’s £3.8 billion Liquidity Fund (Lux) in tokenized format on XRPL. The Lux tokenized fund aims to optimize operational costs and settlement processes by leveraging XRPL infrastructure.
Duncan Muir, senior investment director at abrdn, commented on the development: “The next evolution of financial market infrastructure will be driven by the wider adoption of digital securities. Real benefits should be gained from leveraging the efficiency of moving the investment and end-to-end cash settlement process across the chain.”
Ripple has allocated $5 million to tokens under abrdn’s Lux fund, forming part of a broader strategy to invest in RWAs on XRPL through collaborations with various asset managers. “The arrival of abrdn’s money market fund on XRPL demonstrates how real-world assets are tokenized to enhance operational efficiency, while further cementing XRPL as one of the leading blockchains for real-world asset tokenization,” said Markus Infanger, Senior Vice President at RippleX.
Graham Rodford, CEO of Archax, highlighted the growing momentum in asset tokenization: “Financial institutions are realizing the value of adopting digital assets for real-world use cases. There is now real momentum building for tokenized real assets, and Archax is at the forefront of tokenized assets such as stocks and Debt and money market funds.
The collaboration builds on Archax’s use of Ripple’s digital asset custody solutions since 2022. With increasing investor interest in tokenized money market funds on XRPL, Ripple Custody is leveraging its experience with institutional clients to support the tokenization, storage, exchange and movement of digital assets. .
According to the press release, XRP Ledger’s capabilities provide a strong foundation for RWA tokenization and institutional-level DeFi applications. Ripple has used XRPL for more than a decade, supporting various financial services such as global payments, custody of digital assets, and issuance of stablecoins.
Market analysis from McKinsey indicates that tokenized money market funds have exceeded $1 billion in assets under management, with forecasts suggesting that the value of tokenized assets could reach $16 trillion by 2030.
At press time, XRP was trading at $1.47.
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