Why XRP and XLM Are the Backbone of a New Financial Order

April 5, 2025 by Mishal Ali

Key Takeaways:

• XRP and XLM play distinct but interconnected roles in reshaping global finance.
• XRP focuses on liquidity and institutional bridging; XLM targets financial inclusion and retail use.
• Ripple’s investments, like RLUSD and VELO, strengthen this synergy toward a tokenized monetary future.

Black Swan Capitalist’s Versan Aljarrah has recently unboxed an interesting premise that sees what are considered rivalries between XRP and XLM actually cooperating on the same destination: a borderless financial system.

This perspective recasts the two as complementary halves to a whole whose individual roles are to redefine finance. In his piece, Aljarrah focuses on the role of XRP as a bridge linking the present fiat-based world to the decentralized future.

With RippleNet as its foundation, XRP increases global liquidity, supports near-instant cross-border settlements, and promotes institutional adoption.

Conversely, the XLM running on the Stellar network focuses on underserved segments by facilitating peer-to-peer settlements and allowing stablecoins and CBDCs.

Aljarrah describes the XRP as the high-speed road on which financial institutions travel and the open road on which everyone else travels.

Ripple’s support of projects such as Stronghold’s SHX and VELO Protocol demonstrates additional strategic alignment.

Both of these partnerships are designed to facilitate secure custody of assets and decentralized lending in an effort to support Stellar’s mission to empower the underbanked, with XRP providing liquidity to fuel such networks.

XRP and XLM: Roles That Complement, Not Clash

XRP has traditionally held the position as the liquidity driver of world finances. It ensures that institutions can send money quickly, inexpensively, and in volume. Its interoperability with other networks such as HBAR and XDC makes it all the more a universal financial connector.

Conversely, XLM is built to put those funds to work on the ground level. Its lean architecture supports easy remittances and everyday transactions.

This dual-layered functionality reflects the vision of the Bank for International Settlements: a bi-level system in which institutional and retail financing exist side by side based on complementary but distinct digital assets.

The synergy is apparent in the way that XRP introduces institutional liquidity into decentralized markets, and it is then circulated on a micro-level by the use of XLM.

He likens this to an endless loop: XRP introduces the flow, and XLM disperses it. This process isn’t only operationally optimal but also philosophically consistent with global aspirations of inclusion and modernization.

Ripple’s RLUSD Aims to Boost Global Adoption and Trust

Ripple’s new stablecoin effort, RLUSD, marks the next move in this process. Backed by the US dollar, RLUSD is not only a digital representation of fiat currency, it’s the start of a tokenized environment governed and interfaced with traditional markets.

With RLUSD, Ripple confronts regulatory issues while preparing the way for future tokenized currencies. Its foundation, supported by the liquidity of XRP, ensures the smooth cross-border flow of digital dollars to support institutional trust and user adoption.

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