Although XRP has nothing to do with ISO 20022, the coin might still benefit from Ripple’s involvement with the messaging standard.
The significance of ISO 20022 to the global financial industry cannot be overemphasized. Financial institutions are recognizing the importance of the ISO 20022 messaging standard, as reflected in the rate at which they have complied with the concept.
Financial Institutions Complying with ISO 20022 Standard
Approximately 72% of global banks on the SWIFT network are projected to migrate to the ISO 20022 standard by the November 2025 deadline. Additionally, more institutions are expected to comply with the messaging standard by 2025 as part of SWIFT’s ongoing transition.
For context, ISO 20022 is a globally recognized standard for financial messaging, enabling seamless electronic data exchange between financial institutions worldwide. Notably, SWIFT aims to replace its current messaging standard (MT) with ISO 20022, driving broader adoption and compliance among financial institutions.
Ripple Becomes Part of ISO 20022
Initially developed as a messaging standard for traditional financial institutions, the concept is gradually extending into the crypto sector.
Crypto-related companies, like Ripple, have become part of the global messaging standard for financial transactions. The crypto payments company announced its membership in May 2020.
At the time, Ripple emphasized that its compliance with ISO 20022 standard would allow RippleNet clients to access a network of global financial institutions through a unified API for all counterparty transactions.
Is XRP ISO 20022 Compliant?
Following Ripple’s compliance with ISO 20022, some community members speculate that XRP is also compliant with the messaging standard. Some commentators, including Ben Armstrong (BitBoy), have conferred the title “ISO 20022 compliant coin” on XRP due to Ripple’s involvement with the concept.
Last month, BitBoy stated that the ISO 20022 standard was developed with XRP in mind. However, prominent XRP community members debunked this claim. They referred to a statement from Ripple’s CTO, David Schwartz, refuting XRP’s relationship with ISO 20022.
“XRP has nothing to do with ISO 20022,” Schwartz remarked.
The Ripple exec mentioned that while ISO 20022 is a messaging standard for payments, XRP is only a cryptocurrency.
David Schwartz debunks XRP relationship with ISO 20022
How XRP Might Benefit from Ripple’s Compliance with ISO 20022
Although XRP cannot be referred to as an ISO 20022-compliant coin, it could benefit from Ripple’s involvement with the messaging standard.
XRP could be integrated into existing financial systems, especially among ISO 20022-compliant banks, potentially driving the coin’s adoption. Interestingly, XRP’s utility in cross-border payments could also drive its adoption among ISO 20022-compliant institutions.
For context, XRP facilitates faster and low-cost cross-border settlements through Ripple’s payment solution On-Demand Liquidity (ODL), now Ripple Payment. On ODL, XRP functions as a bridge asset between two fiats, eliminating the issues associated with traditional cross-border settlements, including high transaction fees and slower processing time.
With Ripple being an ISO 20022-compliant company, more financial institutions complying with the messaging standard could adopt XRP for cross-border settlements.
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