A well-known XRP community commentator has suggested why banks can use XRP amid what he believes is an upcoming financial crisis.
In particular, XRP maintains resilience amid bear pressure and holds the company above the $2.2 price level I’m struggling to break through that. As the broader crypto market enters another phase of integration, XRP faces a recent obstacle to recovery push.
However, community experts such as Versan Aljarrah, co-founder of Black Swan Capitalist, believe that the long-term potential of the assets remains bullish. Aljarrah recently resurfaced the entitled video analysis “Why are banks holding XRP?” To explain how XRP fits into the financial scene.
The financial collapse approaching?
In him presentationAljarrah argued why XRP will be important in overcoming the potential collapse of the financial system. He warned that it would deepen the global liquidity crisis.
Specifically, Aljarrah linked the situation to Blackstone’s default with a $562 million debt, suggesting that this could serve as a catalyst for the cascade of margin calls in 2023. Such developments can cause domino effects across the market.
To bolster his case, Aljara also released commentary from various financial leaders. He first referenced a CNBC interview featuring Ed Deforest, senior vice president of Moody’s Investors Services. Deforest focused on rising debt costs and worsening economic conditions. It’s increasing More default possibilities.
Speaking about this, Aljarrah highlighted that the margin call has not yet been fully realized and that he has been leveraging investors who have borrowed heavily for their investments. stock And real estate becomes the most vulnerable when calculations come.
Institutions and individuals have become deeply overdone
He then highlighted comments from bestselling author Doug Casey. He emphasized that inflation could spiral far higher unless there is an overwhelming deflationary event.
Casey pointed it out. both Businesses and individuals become very multi-layered, with defaults surged when economic activity slows. Aljarrah agreed, saying the debt crisis could quickly lead to widespread bankruptcy and heighten pressure on an already vulnerable financial system.
He further explained that when Margin calls forced companies to settle their assets, prices will plummet and feed viciously. Sales cycle. The critic warned of this Liquidity Crunchonce it reaches the real economy, it could limit access to business and consumers’ trust. This may lead to a long-term phase of economic stagnation.
Additionally, another comment on Aljarrah’s video came from CNBC contributor and author Larry McDonald. Bear trap report. McDonald said the systemic risk indicator suggests one of the highest odds of a stock market crash within 60 days.
Interestingly, he suggested that each rate hike of 1% would remove around $500 billion from middle-class families, which exacerbate financial tensions.
XRP could be the solution
Meanwhile, as a financial situation It’s getting worseAljarrah presented XRP as a solution. He spotlighted the usefulness of XRP and the underlying technology in injecting fluidity into it. Finance system.
Market critics later featured an interview with Rosa Rios, a former US Treasury official and Ripple’s board member.
Aljarrah pointed out that XRP’s on-demand liquidity capabilities could become important in the event of a decline in traditional financial systems. He said that when the central bank prepares for liquidity shocks by holding money and potentially XRP, Ripple Protocol It already fits central bank payment rails. He speculated that once the financial collapse unfolds, a shift to utility tokens like XRP could continue.
Additionally, the video also includes comments from Brad Garlinghouse, CEO of Ripplecriticised the US regulatory approach and proposed a framework that supports innovation while protecting consumers.
Aljarrah believes that when liquidity crunch hits, demand for XRP will skyrocket and could raise prices, particularly if legal uncertainty surrounding assets such as SEC litigation is resolved soon.
