A research paper co-authored by new Federal Reserve Chair Kevin Warsh in 2022 is getting fresh attention this week for singling out XRP as a liquidity solution between stablecoins and a bridge currency for cross-border payments. Tom, founder of OpenFind, flagged the paper on social media, calling it proof of Ripple's growing importance in digital money infrastructure. Warsh, who disclosed his crypto holdings before his nomination hearing, has been viewed as pro-crypto, and the paper argues that private sector infrastructure like Ripple should not be ruled out in future digital money systems.
The Paper's XRP Angle
The 2022 paper, co-authored by Warsh before he took the Fed's top job, explicitly named XRP as a bridge currency between stablecoins — a role Ripple has long pitched for its native token. Former Ripple CTO David Schwartz has said XRP holds advantages over stablecoins in that role, mainly because no single stablecoin has achieved universal consensus. Ripple already uses XRP as a bridge in its cross-border payments service, processing transactions through its on-demand liquidity network.
Ripple's Fed and DTCC Push
Ripple's timing here matters. The company has applied for a Fed master account, and the central bank is weighing a so-called skinny master account that would give non-bank payment firms access to central bank payment rails. Separately, Ripple Prime has joined the DTCC's blockchain ecosystem. The DTCC clears $114 trillion in securities annually and just announced it will begin 24/5 near-continuous U.S. equities processing from Sunday through Friday. Pundit X Finance Bull argues the market hasn't priced in the bullish implications of that DTCC integration for XRP. If the DTCC eventually clears tokenized equities on the XRP Ledger, that could drive significant volume through XRP.
Market Reaction
XRP was trading around $1.35 at the time of writing, up over 3% on the day. The gains come as the Warsh paper resurfaced and as broader market sentiment tilted positive. Whether the Fed master account bid or DTCC integration will move the needle further is an open question — but for now, the narrative around Ripple's institutional utility is getting a fresh airing from the top of the U.S. central bank.
