John Deaton Explains Why Ripple Is Expanding Its Custody Infrastructure

Ripple is increasing the size of its investments in cryptocurrency custody, but legal expert John Deaton says the stablecoin issuer is playing the long game. John Deaton says the change in direction will see Ripple offer tokenization-as-a-service to global financial institutions, potentially improving the XRP price.

Ripple Turns Its Sight On Custody Services

According to an X post by crypto lawyer John Deaton, Ripple Labs is pitching its addition of custodial offerings to its range of payment services. Deaton says that a bird’s eye view of Ripple’s plays will reveal the bigger picture for the stablecoin issuer.

For Deaton, Ripple’s Hidden Road broker deal is the clearest signal for the company’s foray into custodial services. Ripple has previously acquired Metaco and Standard Custody in 2023 and 2024, splurging billions on the acquisitions.

Why Is Ripple Aggressively Pursuing Custodial Capabilities?

John Deaton notes that the primary reason for the pivot to custodial service is a play to position Ripple as an all-in-one hub for financial institutions embracing distributed ledger technology.

“By offering custody alongside payments and stablecoin solutions, Ripple becomes a one-stop shop for financial institutions integrating blockchain technology,” said Deaton.

Deaton notes that the aggressive push toward custody services is an attempt to “make up for lost time” following its long-running SEC case. The crypto lawyer surmises that Ripple is keen on snatching a chunk of the market share amid projections of the custody market capitalization tipped to reach 16 trillion in market share by 2030.

Deaton Says The End Game Is A Big Push Toward Tokenization

According to John Deaton, Ripple is positioning itself to advance toward providing tokenization-as-a-service to banks. Ripple will achieve this by leveraging its growing custody infrastructure to provide a seamless window for financial institutions to tokenize traditional assets.

John Deaton says the future offerings will allow financial sector players to tokenize stocks and real estate from a single platform. The end game will see the XRP Ledger evolve to be the hub for tokenized assets, with the RLUSD stablecoin playing a significant role.

The tokenization use case will improve the stablecoin adoption, with a CoinGape article predicting XRP’s price if RLUSD captures 80% of USDT’s market share. Deaton says Ripple is increasing its activity levels to put significant distance between itself and its closest competitor.

“Looks to me that Brad Garlinghouse is making up for lost time after being slowed down by the SEC lawsuit,” said Deaton.

Ripple is facing increasing competition from Circle’s Payment Network launch, designed to offer real-time payments.

XRP Price Outlook Amid The Wave Of Acquisitions

Ripple’s wave of acquisitions has triggered enthusiasm for an XRP price rally in the coming months. At the moment, XRP price is trading at $2.30, gaining nearly 7% over the last day.

Outside of the acquisition spree, a major needle-mover for XRP price will be RLUSD adoption levels. XRP price can clinch $3.30 if RLUSD volume rises by 45%, while SEC approvals for ETFs will play a role in the predicted rally.

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Aliyu Pokima

Aliyu Pokima is a seasoned cryptocurrency and emerging technologies journalist with a knack for covering needle-moving stories in the space. Aliyu delivers breaking news stories, regulatory updates, and insightful analysis with depth and precision. When he's not poring over charts or following leads, Aliyu enjoys playing the bass guitar, lifting weights and running marathons.