Ripple and Arf partner to bring RLUSD settlement liquidity to XRP Ledger

What happened

Ripple and Arf, a Zug-based settlement platform, said on Oct. 22 that they are teaming up to provide RLUSD-denominated settlement liquidity on the XRP Ledger. The service is aimed at licensed cross-border payment companies that need short-term capital while transfers are in transit. Arf, which describes itself as a Swiss-regulated financial institution, reports roughly $10 billion in annual settlement volume.

In the first phase, Arf will supply RLUSD working capital directly on XRPL. Payment firms can draw funds to cover cross-border obligations and repay once the underlying transfers settle, typically within one to five days, according to the announcements. Arf says its capital turns over about four times a month, allowing the same pool to support repeated payment flows. Arf handles fiat-to-stablecoin conversion through its bank accounts, so clients do not have to interact with the blockchain directly, reports said.

The companies plan a second phase in which Arf would use XRPL's proposed native lending system. That setup relies on XLS-65, which would create Single Asset Vaults for pooled funds, and XLS-66, which would define a Lending Protocol for structured loans. Bitcoin.com News also noted a related amendment, LendingProtocolV1_1, that would update vault and lending rules. Arf would continue to handle underwriting and working-capital decisions offchain, while RLUSD would be used for loan disbursements and repayments and XRP would cover network fees and reserve requirements.

Why it matters

Cross-border payment providers often keep balances in multiple currencies and banking systems so they can pay out before incoming funds arrive. Arf and Ripple argue that traditional credit lines can require large collateral and take months to arrange, which is cumbersome when liquidity needs shift between corridors. The partnership gives XRPL a prospective institutional lending use case tied to an existing payments business, and it expands RLUSD's role beyond transfers into short-term credit. Still, the immediate phase uses Arf's direct lending rather than native onchain credit, so the blockchain's role will scale only as Arf and its clients use the service.

What the data shows

Arf reports about $10 billion in annual global settlement volume and says its capital turns over four times per month. The initial financing is typically repaid in one to five days. The announcements did not disclose a financing commitment, how much RLUSD will be allocated, or how much transaction volume will initially move through XRPL, according to Crypto.news. On the amendment tracker cited by 99Bitcoins, the Lending Protocol had 17 of 32 validator votes and Single Asset Vaults had 19, below the support needed. XRPL amendments require more than 80% validator approval sustained for two weeks before mainnet activation. 99Bitcoins also reported that RLUSD supply on XRPL was about $939.82 million, down from $1.05 billion a week earlier, while Ethereum-hosted RLUSD supply was $1.46 billion.

Background

Ripple has been widening RLUSD's presence in payments. CoinGape reported that Cross River Bank partnered with Ripple to integrate stablecoin payments into its banking infrastructure, and that DriveWealth integrated RLUSD for settlement in Europe. Other groups are also preparing RLUSD lending on XRPL: Bitcoin.com News said Soil, a fintech lending platform under Orqo Group, plans to pool RLUSD from institutional lenders, while Clearpool and Cicada Partners are developing a separate lending initiative. Arf launched in November 2022 and has scaled its settlement business since then, according to Coinpedia. In August, Ripple's validator backed both lending amendments, Crypto.news reported, adding support for the proposals.

What is still unclear

Several details remain open. Ripple and Arf have not said how large the financing program will be, how much RLUSD will be dedicated to it, or what share of Arf's $10 billion settlement volume will eventually run on XRPL. The timing of native lending is also uncertain because XLS-65, XLS-66 and related amendments still need validator approval. It is not clear whether Arf's clients will use the service at scale or how quickly the company will shift from direct lending to the onchain protocol.

What to watch

Validator support for the lending amendments is the key near-term signal. If XLS-65 and XLS-66 reach the required threshold and activate, Arf plans to move its program onto the native infrastructure. Also worth watching is whether other institutional lending projects, such as those from Soil and Clearpool/Cicada, launch on the same rails, and whether RLUSD usage on XRPL grows alongside the credit program.

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