Ripple CTO: DeFi on XRPL Could Boost Collateral Value of Spot Bitcoin ETFs

IconCryptoNewsTerminal Staff29 May, 2024

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Ripple CTO: DeFi on XRPL Could Boost Collateral Value of Spot Bitcoin ETFs

Ripple's CTO, David Schwartz, believes that decentralized finance (DeFi) built on the XRP Ledger (XRPL) could enhance the collateral value of a Bitcoin spot ETF. "Right now, people can't really borrow against their spot BTC ETF," Schwartz explained to Crypto Briefing. "As adoption increases [...] through things like decentralized identity (DID) that Ripple provides, this will improve." The XRPL aims to provide regulatory-compliant DeFi not only for institutions but also for retail users. Stablecoin issuer Circle has already begun issuing USDC on the XRPL, which is both DeFi-enabled and compliant with regulations. By leveraging XRPL DeFi, the collateral value of spot Bitcoin ETFs could be increased, making them more attractive to investors seeking to borrow against their crypto assets.

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