Ripple Partners with Arf to Bring RLUSD Liquidity to XRP Ledger

Ripple has partnered with Swiss-regulated financial institution Arf to bring RLUSD-driven settlement liquidity to the XRP Ledger, expanding the blockchain's role in cross-border payments and institutional lending.

Since its launch in November 2022, Arf has processed nearly $10 billion in annual global settlement volume.

The collaboration aims to provide short-term working capital to licensed payment companies.

How Will Ripple and Arf Improve Cross-Border Payments?

Cross-border payment companies typically require substantial working capital to pre-fund transactions while awaiting settlement.

Traditional bank financing can take months to arrange and requires significant collateral, limiting the liquidity available to international markets.

Arf's payment financing model addresses this challenge by offering short-term settlement liquidity, typically repaid within 1 to 5 days.

Through the collaboration announced on October 22, Arf will initially use Ripple's RLUSD stablecoin on XRPL to provide direct settlement liquidity and support additional payment volume.

Jasmine Cooper, Head of Product at RippleX, stated that XRPL's fast settlement capabilities and RLUSD's regulated dollar infrastructure make the network suitable for institutional liquidity financing.

XRPL Lending to Drive Institutional Adoption

Arf plans to integrate XRPL's proposed native lending infrastructure, expanding settlement liquidity through single-asset vaults for pooling funds and lending protocols for structured loans.

Arf will retain off-chain underwriting and credit decisions while managing lending on XRPL.

This transition depends on the approval and activation of the XLS-65 and XLS-66 amendments.

Arf has developed an implementation plan and is providing feedback.

The partnership could drive institutional adoption of RLUSD by enabling revolving loan issuance and repayment for cross-border settlements.

Arf's revolving liquidity model allows capital to be reused upon transaction settlement, potentially increasing demand for RLUSD.

XRPL's institutional expansion comes amid rising network engagement, despite XRP price volatility.

Santiment Intelligence data shows non-empty wallets hit an all-time high of 8.24 million, with 4,772 new wallets added in a single day, the fifth-largest increase since March.

XRP is near $1.32, with a break above $1.40 potentially targeting $1.50, while a drop below $1.30 could weaken the bullish outlook.

Growing institutional activity may increase XRP transaction fees and reserve requirements, although adoption does not guarantee price appreciation.