XRP Ledger is back in the discussion as liquidity conditions tighten and funding becomes more expensive. Versan Aljarrah, founder of Black Swan Capitalist, argues that stronger deflationary pressure can make institutional users place greater weight on payment efficiency, especially where lower-cost infrastructure is available.
Why legacy cross-border rails are under pressure
According to Aljarrah, traditional cross-border payments rely on a chain of intermediary financial institutions. That structure tends to produce higher transaction costs and slower settlement, with some payments taking days to complete. For banks, payment firms, and other financial institutions, those frictions matter more when liquidity is scarce.
By comparison, transactions on the XRP Ledger are settled in seconds and at much lower cost. The analysis says those features could make XRPL more attractive to institutions trying to reduce operating costs tied to payments and settlement.
XRP’s role as a bridge asset
The argument centers on XRP’s function as a bridge asset inside the network. If international payments, liquidity management, and tokenized asset transfers on XRPL gain broader adoption, demand for XRP could increase because it can move value between different currencies without requiring institutions to hold balances abroad in advance.
The article defines a bridge asset as an intermediary asset used to convert between two currencies or assets quickly. Pre-funding, in this context, means institutions must keep money parked in foreign accounts before payments are processed, which ties up capital and adds cost to cross-border activity.
Burn mechanics and long-term supply effects
Aljarrah also points to XRP’s deflationary design. Each transaction on XRPL permanently removes a very small amount of XRP from circulation. The amount burned per transaction is tiny, so the effect is limited in the short run; still, over time, a network handling tens of millions of transactions could see a gradual reduction in available supply.
The piece is careful on this point. The burn rate is small enough that usage growth is the real variable. Without sustained expansion in network activity, the cumulative supply impact would remain modest.
Institutional adoption remains the main question
In Aljarrah’s view, XRP’s long-term case depends less on speculation and more on practical utility. He expects that financial institutions looking for faster and cheaper settlement tools in a period of costly liquidity may give XRP Ledger a larger role in global payments. The article does not add new on-chain metrics or fresh institutional deployment examples, and its case rests mainly on efficiency claims, bridge-asset use, and the network’s supply mechanics.