Bank of International Settlements Outlines the Very Problem XRP Was Built to Solve

SMQKE (@SMQKEDQG), a crypto researcher active on X, recently posted a video featuring remarks made by a representative from the Bank for International Settlements (BIS). The BIS said that a third-party currency with sufficient liquidity is critical for efficient cross-border payments. According to him, this aligns directly with XRP’s function in Ripple’s model, which positions the digital asset as a neutral bridge currency capable of reducing reliance on fragmented correspondent banking. Bank of International Settlements: Emphasizing that a third party currency with sufficient liquidity is essential for efficient cross border payments. This aligns perfectly with XRP’s role in Ripple’s model as an independent and neutral bridge asset that removes dependence on… pic.twitter.com/YN568Utujl — SMQKE (@SMQKEDQG) August 26, 2025 Three Dimensions of Interoperability In the video, the BIS speaker addressed the challenges of making digital currencies “talk to each other,” describing interoperability on three levels. The first involved domestic interoperability, where digital currency solutions must interact with existing systems on shared platforms. Such platforms, the speaker noted, create “huge network externalities” by allowing broader connectivity. The second level concerned cross-border transactions within the same currency. Although this could introduce further operational challenges, XRP can easily play this role. However, it was the cross-currency and cross-border dimension that was described as the most difficult. While XRP can also bridge multiple currencies, the speaker divided the problems into three categories: technology, liquidity, and policy. Technology, Liquidity, and Policy Barriers Technologically, systems rely on different cryptographic frameworks, making communication difficult, with the “messaging element” described as fundamental. Liquidity was identified as more complex, as many currency pairs lack natural demand. This makes an intermediary asset necessary. “You need to go and search for a third-party currency in order to make this settlement actually happen,” he explained. The most difficult barrier is policy, as nations apply divergent rules. While risk-based AML-CFT standards can be coded, principles-based regulations are harder to align. With over one hundred jurisdictions, “110 nations might have 110 different ways of looking at this.” We are on X, follow us to connect with us :- @TimesTabloid1 — TimesTabloid (@TimesTabloid1) June 15, 2025 How Can XRP Solve This Problem? This focus on liquidity as an indispensable component of interoperability closely mirrors arguments about XRP’s intended utility. Ripple’s model uses XRP as a bridge asset to eliminate the need for multiple correspondent banking relationships. By providing independent liquidity that is not tied to the monetary policy of any one nation, XRP aims to streamline settlement across otherwise fragmented systems. SMQKE emphasized that the BIS framework essentially outlined the very problem XRP was designed to address . His post concluded that the institution’s acknowledgment of liquidity constraints reinforces the relevance of XRP as a neutral, liquid digital asset for efficient global payments. 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. Follow us on X , Facebook , Telegram , and Google News The post Bank of International Settlements Outlines the Very Problem XRP Was Built to Solve appeared first on Times Tabloid .