The recent collaboration between Ripple’s acquired firm, Metaco, and HSBC, one of the world’s largest banks, has sparked excitement among the XRP community, often referred to as the “XRP army.” This development is seen as a positive indicator that financial institutions may increasingly adopt Ripple’s ledger protocol and, notably, the XRP token.
Named after the cryptocurrency facilitating liquidity movement on the XRP Ledger utilized by Ripple, the XRP army views HSBC’s selection of Metaco as a custody tech partner as another step toward wider adoption of XRPL and the XRP token.
While the crypto space tends to be tribal, with enthusiasts rallying behind their chosen blockchain, it’s important to critically assess such developments. The assumption that HSBC’s decision is solely influenced by Ripple’s recent acquisition overlooks the fact that Metaco had been engaging with the bank for over 18 months, according to Adrien Treccani, CEO of the Swiss custody firm.
Despite the indirect correlation between Ripple protocols and Metaco’s banking clients, Treccani highlights that every success for Ripple as a company contributes to the success of the XRP Ledger. Ripple has actively courted banks, focusing on areas like cross-border payments, making XRPL one of the longest-running private tokenization blockchains.
Treccani underscores the advantages of XRPL, noting that it is designed for both public and private use, offering better scalability than competitors like Ethereum Virtual Machine (EVM) chains. He emphasizes its native support for tokenized assets without relying on smart contracts and its ability to facilitate on-chain trading with other blockchain-based exchanges or automated market makers (AMMs).
The integration of Metaco and Ripple forms a comprehensive vertical stack, combining infrastructure and services layers. This collaboration allows the provision of infrastructure, tokenization life cycle, payment primitives, and liquidity management to banks from a single vendor.
Despite the positive developments, concerns arose post-Metaco acquisition, with rumors suggesting some banking clients were considering alternatives due to Ripple’s dispute with the U.S. Securities and Exchange Commission (SEC). Treccani dismisses some of the speculation as “frankly a little bit crazy,” acknowledging that discussions and reassessments post-acquisition are standard. He mentions ongoing clarifications with banks and hints at upcoming tier one bank partnerships across various regions.
Treccani sees the trend toward tokenization as a crucial move for banks, aligning with his belief that many will eventually offer cryptocurrency-related services. By building for tokenization now, institutions can be well-prepared for cryptocurrency entry when the time comes.
“In this game, if it was just for tokenization, I would not be in this game,” Treccani asserts, emphasizing his commitment to cryptocurrency and its underlying principles.