In a bold declaration from the heart of Europe’s financial landscape, Oliver Michel, CEO of Tokentus Investment AG—a leading German Web3 venture capital firm—has positioned XRP as a potential cornerstone of the future global financial system. Speaking on the floor of the Frankfurt Stock Exchange during an interview with Der Aktionär, Michel articulated a compelling vision: XRP could evolve into the world’s reserve bridge currency, particularly as central banks accelerate their development of central bank digital currencies (CBDCs).
This statement marks a significant moment in the broader acceptance of digital assets within traditional finance. Unlike speculative commentary often heard in crypto circles, Michel’s insight comes from a seasoned investor deeply embedded in both blockchain innovation and institutional finance.
The Flaws in Traditional Cross-Border Payments
At the core of Michel’s argument lies a well-documented pain point: the inefficiency of current cross-border payment systems.
Imagine a simple transaction—sending money from Germany to the United States. In today’s banking infrastructure, this process involves multiple intermediaries, currency conversions, compliance checks, and often takes several days to settle. Fees accumulate at each stage, and liquidity must be pre-positioned in foreign accounts, tying up capital unnecessarily.
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Michel pointed out that these inefficiencies are not just inconvenient—they represent systemic friction that hampers international trade and economic inclusivity. He noted that Ripple’s foundational innovation was born precisely to address this issue: enabling near-instant, low-cost international settlements without the need for pre-funded nostro accounts.
How XRP Enables Instant, Low-Cost Settlements
The solution, according to Michel, lies in XRP’s role as a bridge asset within Ripple’s On-Demand Liquidity (ODL) system.
Here’s how it works:
- A sender in Germany initiates a euro transfer.
- Their financial institution instantly converts euros into XRP via a digital asset exchange or liquidity provider.
- The XRP is transmitted across the XRP Ledger (XRPL) in seconds—regardless of geography.
- Upon arrival, the recipient’s bank or payment provider converts XRP into U.S. dollars and delivers the funds.
This entire process occurs in under five seconds, with minimal transaction costs—often less than $1. Compare that to traditional SWIFT transfers, which can take 3–5 business days and incur fees ranging from $20 to over $50.
Michel emphasized that this isn’t theoretical. Ripple has already partnered with financial institutions across emerging markets—such as MoneyGram, SBI Remit, and Pyypl—where fast, affordable remittances are critical. These real-world implementations prove that XRP-powered settlement is not only viable but scalable.
“That’s actually the motivation of Ripple – so that the banks or the central banks can exchange the classical currencies into XRP.”
This quote, translated from Michel’s original German remarks, underscores a strategic shift: viewing XRP not as a speculative token, but as functional infrastructure for modern finance.
XRP and the Rise of Central Bank Digital Currencies (CBDCs)
One of the most forward-looking aspects of Michel’s analysis centers on the convergence between XRP Ledger (XRPL) and CBDCs.
As governments worldwide—including those in China, the UAE, and several European nations—ramp up CBDC pilots, a new challenge emerges: interoperability. How will digital euros interact with digital yuan or digital dollars? Who ensures seamless value transfer across sovereign digital currencies?
Michel believes Ripple’s technology—and by extension, XRP—could provide the answer.
He argued that XRPL’s open-source, decentralized framework is uniquely suited to serve as a neutral settlement layer between central banks. Unlike proprietary systems such as JPMorgan’s JPM Coin, which operates within closed networks, XRPL offers permissionless access and transparency, making it more attractive for cross-jurisdictional coordination.
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Moreover, Michel highlighted Ripple’s first-mover advantage. While other institutions are still experimenting, Ripple has spent over a decade building relationships with regulators, refining its compliance tools, and stress-testing its network through live transactions. This maturity positions XRP as a trusted intermediary in a future multi-CBDC world.
“With its offer and if time plays for Ripple, then Ripple [XRP] can certainly become the world reserve bridge currency.”
Core Keywords Driving the Narrative
To align with search intent and enhance discoverability, key terms naturally woven throughout this discussion include:
- XRP
- World reserve currency
- Cross-border payments
- CBDCs (Central Bank Digital Currencies)
- On-Demand Liquidity (ODL)
- XRP Ledger (XRPL)
- Ripple
- Bridge currency
These keywords reflect both technical depth and macroeconomic relevance—crucial for readers researching digital assets' role in reshaping global finance.
Frequently Asked Questions (FAQ)
Q: What does 'world reserve bridge currency' mean in the context of XRP?
A: It refers to XRP acting as an intermediary asset that facilitates fast and low-cost conversion between different fiat currencies—like euros to dollars—without requiring direct trading pairs or pre-funded accounts.
Q: Can XRP really compete with established systems like SWIFT?
A: Not by replacing SWIFT directly, but by offering a superior alternative for specific use cases—especially high-frequency, cross-border remittances where speed and cost matter most. Many banks are already testing or using RippleNet with ODL to reduce reliance on legacy rails.
Q: Is XRP decentralized enough to be a global standard?
A: While debates about decentralization persist, the XRP Ledger operates with a growing number of independent validator nodes. Its design prioritizes efficiency and security, making it suitable for institutional adoption while continuing to evolve toward greater decentralization.
Q: How do CBDCs increase demand for XRP?
A: As CBDCs emerge, they’ll need neutral settlement layers to communicate across borders. XRP can serve as a liquidity tool during these exchanges, reducing friction and eliminating the need for complex bilateral agreements.
Q: Does regulatory uncertainty around XRP affect its potential?
A: The ongoing SEC lawsuit has created headwinds, but Ripple’s partial victories—such as the ruling that XRP is not inherently a security when sold to retail investors—have strengthened its legal standing. Clarity continues to improve globally.
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Final Thoughts: A Vision Grounded in Real-World Utility
Oliver Michel’s endorsement of XRP goes beyond bullish sentiment. It reflects a growing recognition among institutional investors that blockchain-based solutions are no longer futuristic—they’re operational.
The fusion of XRP, ODL, and XRPL creates a powerful trifecta: speed, scalability, and cost-efficiency. When combined with the inevitable rollout of CBDCs, the conditions are ripe for XRP to play a pivotal role in global finance—not as a replacement for fiat, but as a bridge between them.
While challenges remain—including regulatory clarity and broader adoption—Michel’s vision offers a plausible pathway: one where XRP becomes the invisible engine powering tomorrow’s borderless economy.