Ripple’s XRP Ledge will start tokenize asset management abrdn’s $4.77 billion US dollar Liquidity Fund.
Blockchain payments firm Ripple has announced the debut of the first tokenized money market fund on the XRP Ledger.
The fund is based on asset manager abrdn’s $4.77 billion (3.8 billion British pounds) US Dollar Liquidity Fund.
Partnership with Archax Enables Tokenization
The initiative was made possible through Ripple’s collaboration with Archax, the United Kingdom’s first cryptocurrency exchange, broker, and custodian regulated by the Financial Conduct Authority. Archax provides access to abrdn’s money market fund.
Ripple highlighted in a Nov. 25 statement that the tokenization of abrdn’s $4.77 billion fund on the XRP Ledger illustrates the growing trend of real-world assets (RWAs) transitioning on-chain.
This shift is expected to deliver significant operational cost savings and settlement efficiencies.
Duncan Moir, senior investment manager at abrdn, remarked, “Real benefits are to be had from leveraging the efficiency of moving the end-to-end investment and cash settlement process on-chain.”
Access to abrdn’s tokenized money market fund on the XRP Ledger will be limited to “professional investors” via Archax’s tokenization platform, according to Ripple.
Ripple also announced it will allocate $5 million into tokens linked to abrdn’s US Dollar Liquidity Fund.
Real-World Asset Market Potential
This move aligns with Ripple’s broader RWA strategy to capitalize on a market projected to reach $16 trillion by 2030, as estimated by Boston Consulting Group.
Tokenized money market funds currently manage over $1 billion in assets, led by BlackRock’s USD Institutional Digital Liquidity Fund, which holds $443.9 million, according to data from Dune Analytics and asset manager 21Shares.
“There is now real momentum building for tokenized real-world assets,” stated Archax CEO Graham Rodford.
Competition in the Tokenized RWA Space
According to Dune Analytics data, ripple faces competition in the RWA space from Ethereum and Stellar, which have tokenized $3.07 billion and $386.2 million worth of RWA assets.
The most commonly tokenized RWAs, excluding fiat-collateralized stablecoins, are government securities and commodities, which account for $2.28 billion and $1.14 billion, respectively.
Meanwhile, Ripple’s XRP token has been a strong performer, surging 27.9% over the past week to $1.43.
