An XRPL validator says $XRP addresses some of the concerns recently raised by the IMF regarding the adoption of tokenized finance.
The International Monetary Fund (IMF) recently shared a note on tokenization and blockchain technology, stressing that while the idea shows promise, it could also bring risks to the global financial system. Reacting to this, Vet, a vocal validator on the $XRP Ledger, argued that XRPL already solves some of the issues the IMF pointed out.
Key Points
- The IMF stated that tokenization enables instant settlement, automation, and real-time liquidity, fundamentally transforming how financial systems operate.
- However, it also warned of multiple issues that it may pose due to its speed, complexity, and potential for market fragmentation.
- XRPL validator Vet argues that XRPL solves the compliance concerns through features like XLS-80 and XLS-81.
- He added that instead of complex systems requiring 190 liquidity pools for 20 central banks, a neutral bridge asset like $XRP could be a better choice.
IMF Lists Key Risks in Tokenized Finance
In the recently released note, the IMF said risk is the biggest concern with tokenization. While it reduces some traditional issues like counterparty risk, it also brings new ones.
For instance, due to transactions, margin calls, and liquidations happening instantly, market stress could lead to rapid sell-offs and sharp volatility before regulators can react.
The note also warned that real-time settlement could remove traditional buffers, meaning institutions must always have enough liquidity, which increases the risk of sudden shortages. Also, shared systems may become single points of failure.
The IMF also argued that errors in smart contracts or data feeds could cause automatic failures, while systems like margin calls may worsen downturns by forcing simultaneous selling. It further raised concerns about weaker economies losing control over their currencies due to foreign stablecoins.
XRPL Already Addresses Compliance Issues
In response, Vet said the IMF made a major mistake by not considering built-in compliance features on XRPL, especially its Permissioned DEX and Permissioned Domain. He argued that these features already solve the compliance concerns the IMF raised.
I think the IMF is mistaken big time and made the calculation without native on chain compliance like we have $XRP‘s Permissioned DEX/Domain.
Also, why a neutral assets like $XRP (or ETH/BTC etc) are the answer to their open end settlement asset gap:
1) The IMF is in favor of… pic.twitter.com/s8UsmLUDNX
— Vet (@Vet_X0) April 2, 2026
Vet noted that the IMF prefers institution-controlled permissioned blockchains over permissionless ones because of KYC and AML requirements.
However, he said XRPL has already solved this through upgrades like XLS-80 and XLS-81, which introduced Permissioned Domain and Permissioned DEX earlier this year. These features allow compliant trading, lending, and other financial activities to happen directly on-chain.
The XRPL validator also called attention to decentralized identity (DID) and credential systems, saying they support even more use cases and improve compliance within the XRPL system.
$XRP as a Neutral Bridge
Speaking further, Vet agreed with the IMF that liquidity fragmentation is a real problem. He stressed that the IMF suggests using synthetic central bank digital currencies (sCBDCs), which private issuers would create but back with central bank reserves, to deal with risks like money market runs.
However, he argued that the IMF did not fully address the settlement asset issue. In its model, central banks would need to provide liquidity for every stablecoin pair. He explained that if 20 central banks are involved, this would require 190 liquidity pools, making the system difficult to manage.
Vet questioned whether central banks would realistically agree to so many bilateral arrangements, especially given current trust issues. Instead, he suggested a simpler approach: using a neutral bridge asset to bring liquidity together without needing multiple agreements. Notably, $XRP could act as this neutral bridge.
