- In a bold move, Ripple released a “Digital Asset Custody Guide” to convince more banks to adopt its blockchain-based custody solutions.
Ripple has been unwavering in carving its niche within institutions despite having to deal with what Coinbase CEO Brian Armstrong referred to as “frivolous lawsuits” initiated by the US government and the sluggish price action of its associated token, XRP. Recently, the company, headed by CEO Brad Garlinghouse, published its “Digital Asset Custody Guide.”
The document serves as a blueprint for managing digital assets to unlock revenue streams. It also aims to usher in customer trust in a market that the company expects to grow to $20 trillion by the end of the decade.
Growing Institutional Adoption of Digital Assets
According to Ripple, digital asset adoption has accelerated at a “fever pitch.” This is because various enterprises are now recognizing the strategic advantages that blockchain brings to businesses. These primarily include speed, transparency, and immutability in transactions. These elements allow institutions to harness cost-efficiency, reduce fraud, and boost liquidity in various finance use cases.
Citing the Northern Trust’s forecasts, the company stated that all these are positioning the digital asset sector toward capturing up to 10% of global assets via tokenization by 2030. Meanwhile, around 64% of retail investors are already engaged or actively holding digital assets in their portfolios. From there, 69% are looking to top up their investments significantly within the next two to three years.
Ripple’s Enterprise Blockchain Use Cases
Ripple emphasized that banks are well-positioned to cater to the core custody needs of both retail and institutional clients. Their injection of digital asset custody alongside their existing banking services would empower a seamless experience for these clients.
The company warned large banks that continually refuse to adapt to the growing demand for digital asset custody. It said they are at risk of being overtaken by their competitors.
On the other hand, regional banks adopting these revolutionary solutions could open up an opportunity for them to compete with neobanks. In addition, their advantages could be amplified if they are located in jurisdictions with “progressive crypto regulations.”
Ripple Custody opens up a gateway for banks to incorporate a digital asset custody platform in their business that’s compliant with stringent international regulatory frameworks. The company proudly claimed that the platform is compatible with strict jurisdictions like Hong Kong and Japan, which require custody providers to secure a certain portion of their customers’ virtual assets in cold storage.
Clients from over 15 countries now utilize Ripple’s institutional digital asset custody solutions. Its features include tokenization of real-world assets (RWAs), securities, and bank deposits. It also offers issuance and custody for the mentioned assets. Moreover, it offers integration of blockchain-based solutions for certain tasks like the reconciliation of books and records at various stages of a transaction.
Banks can scale or customize Ripple’s institutional-grade custody platform as needed. They could adjust it depending on their operational requirements, customer demands, regulatory environment, and other factors. Overall, these could ultimately ensure that they maintain an edge in adapting to the evolving market demands while staying compliant.
