Ripple Steps Out of the SEC Shadow: The Middle East Becomes a Strategic Layout Hub, Public Company Promotes XRP Reserves to Attract Investment from Saudi Princes

Author: Weilin, PANews

While reaching a settlement with the U.S. Securities and Exchange Commission (SEC), Ripple is quickly restarting its global expansion efforts in the Middle East, with Dubai becoming a key point for its layout of tokenized real-world assets (RWA).

Recently, the Ripple-supported blockchain XRP Ledger was selected as the underlying blockchain network for a real estate blockchain tokenization project in Dubai, demonstrating that Ripple and XRP's development in government-enterprise cooperation, cross-border settlement, and stablecoin infrastructure is gradually transforming into the company's business breakthrough direction.

At the same time, on May 29, Nasdaq-listed energy company VivoPower International announced the completion of a $121 million private placement financing, which will pivot to a strategy centered around XRP as its core crypto asset reserve. Saudi Prince Abdulaziz bin Turki Abdulaziz Al Saud led the investment with $100 million, demonstrating Middle Eastern capital's recognition and bet on the XRP ecosystem.

XRP Ledger becomes Dubai's first government property tokenization project on the public chain.

On May 26, the Dubai Land Department (DLD) announced a partnership with asset tokenization platform Ctrl Alt to launch the Middle East's first government-led real estate tokenization project, PRYPCO. The project is supported by the Dubai Virtual Assets Regulatory Authority (VARA) and the Dubai Future Foundation, and plans to achieve on-chain issuance of real estate assets on the XRP Ledger (XRPL) through Ctrl Alt's PRYPCO Mint platform, with a minimum investment threshold of 2000 dirhams (approximately 545 USD).

The project is an important part of Dubai's "Real Estate 2033 Strategy," aiming to achieve a real estate tokenization market worth 60 billion dirhams (approximately 16.3 billion USD) by 2033. Ctrl Alt has obtained a broker and issuer license issued by VARA and has stated that it has completed the tokenization of nearly 295 million USD in assets.

As a major contributor and promoter of XRPL, Ripple has been assigned the role of a technology provider for asset tokenization with government support, representing the expansion of the protocol from cross-border payments to RWA asset support. XRPL adopts the Ripple Protocol Consensus Algorithm (RPCA), which does not require mining, eliminating the energy-intensive mining process and enabling settlement of transactions in seconds.

XRPL is also actively promoting a stablecoin ecosystem on its network. SG-FORGE has announced that it will launch the euro-pegged EURCV on XRPL in 2025; Braza Group will also introduce the stablecoin BBRL, which is pegged to the Brazilian real, on XRPL. These developments lay a solid foundation for building a multi-asset and multi-scenario tokenization base on XRPL.

At the same time, XRP has also gained favor from capital in the Middle East. On May 29, the Nasdaq-listed energy company VivoPower International(VVPR) announced the completion of a $121 million private placement financing and will transform into a strategy centered on XRP as a core crypto asset reserve. Saudi Prince Abdulaziz bin Turki Abdulaziz Al Saud led a $100 million investment, and former SBI Ripple Asia executive Adam Traidman will serve as the chairman of the advisory committee. According to SEC filings, the company plans to issue 20 million common shares at $6.05 per share.

Middle East strategy accelerates: Obtained license from Dubai Financial Services Authority, acquired brokerage firm Hidden Road.

Ripple's emphasis on the Middle Eastern market is not a coincidence. As early as November 2020, Ripple established a regional headquarters in the Dubai International Financial Centre (DIFC), stating that this move was in consideration of the unclear U.S. crypto regulatory policies, which could lead to an exit from the U.S. In December of the same year, the SEC first charged Ripple CEO Brad Garlinghouse and co-founder Chris Larsen with conducting an unregistered securities offering by selling Ripple's digital token XRP since 2013. The SEC claimed that Ripple raised $1.3 billion through these so-called securities sales, while Ripple contended that XRP is not a security. After several years of evolution and development, today, the Middle East accounts for about 20% of Ripple's global customers.

In March of this year, Ripple received a regulatory license from the Dubai Financial Services Authority (DFSA), becoming the first compliant blockchain payment provider in the DIFC and officially launching compliant cryptocurrency cross-border payment services in the UAE. In May, Ripple announced partnerships with UAE digital bank Zand Bank and fintech company Mamo to integrate Ripple's cross-border payment system into their financial service framework, supporting round-the-clock cross-border settlements. Zand Bank also plans to launch a stablecoin pegged to the AED to enhance local digital payment capabilities.

The stablecoin RLUSD is also enriching Ripple's business ecosystem, supporting the company's business expansion. RLUSD not only offers an annual percentage rate (APR) of up to 8%-9% on Aave, quickly attracting around $150 million in funds, but it also landed on Euler Finance on May 29, allowing users to directly lend and borrow RLUSD on the platform and use it as collateral. Currently, the supply annual percentage yield (APY) of RLUSD on Euler is as high as 22.05%. PANews previously reported that Ripple recently partnered with Chainlink to enhance the utility of RLUSD in the DeFi space; Ripple has also collaborated with Revolut and Zero Hash to expand RLUSD's market coverage; while RLUSD was launched on the exchange Kraken, it was also integrated into Ripple's payment solution, Ripple Payments, for cross-border payment processes for clients such as BKK Forex and iSend.

In addition to payment services, Ripple is also intensifying its布局 in brokerage, custody, and tokenization. On April 8 of this year, the crypto payment company Ripple announced plans to acquire major brokerage firm Hidden Road for $1.25 billion, aiming to expand the services it provides to institutional investors. CEO Brad Garlinghouse stated, "Ripple needs to ensure we have the right infrastructure to attract and expand into a larger group of large institutions." This transaction will primarily be conducted in cash, XRP, and stock. The acquisition is expected to be completed in the coming months, pending regulatory approval.

"After the acquisition is completed, Ripple will inject billions of dollars in capital to provide immediate scale and meet the needs of Hidden Road's prime brokerage business." Garlinghouse stated that the major broker will integrate the stablecoin RLUSD as collateral for its prime brokerage products and explore the use of the XRP Ledger to "enhance settlement efficiency."

According to public reports, Hidden Road plans to establish an office in Abu Dhabi. According to insiders, the office will be led by partner James Stickland. Hidden Road has obtained principal approval (IPA) from the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market, and after final approval, it will be able to provide clearing and prime brokerage services to institutional investors in the UAE.

Sources say that after obtaining final regulatory approval, members of the Abu Dhabi royal family may join the board of its local entity at Hidden Road.

"Tokenization as a Service" Can It Succeed? Ripple Regains Development Time Lost to SEC's "Hard Control"

John Deaton, a crypto lawyer supporting Ripple, stated that Ripple's acquisition of Hidden Road is not just a single expansion, but a forward-looking layout for the integration of DeFi and TradFi. He pointed out that Hidden Road processes over $3 trillion in transaction volume annually and serves more than 300 institutional clients, acting as a bridge connecting traditional capital with on-chain clearing.

Deaton believes that Ripple's "Ripple Custody" custody service, along with payment and stablecoin systems, constitutes a one-stop blockchain financial service platform. Its vision is to provide financial institutions such as banks with "Tokenization-as-a-Service," achieving a fully integrated process from asset tokenization, collateral payments to settlement circulation.

According to a forecast by the Boston Consulting Group (BCG), the digital asset custody market is expected to exceed $16 trillion by 2030. In his view, Ripple is trying to seize this opportunity by building a technological layer for the tokenization of global financial assets through the XRP Ledger.

Another reason for Ripple's accelerated progress in the Middle East is its recent developments in the regulatory environment in the United States. On May 9th, Ripple reached a settlement agreement with the SEC, agreeing to pay a $50 million fine and lifting some injunctions. The SEC will also not appeal the previous ruling, marking the formal end of this regulatory tug-of-war that has lasted since 2020.

On May 28, Ripple's Chief Legal Officer Stuart Alderoty submitted a supplemental letter to the SEC, emphasizing that XRP itself does not constitute a security and arguing that most crypto assets should not be considered securities in secondary market trading. He suggested that the SEC introduce a "safe harbor" mechanism to provide more operational compliance guidance for the digital asset market.

Meanwhile, the approval of the XRP spot ETF is also progressing. According to news on May 28, the SEC has officially reviewed the WisdomTree XRP Fund application submitted by the Cboe BZX Exchange. If approved smoothly, Ripple may welcome another wave of capital and user inflows.

Overall, after several years of fierce battles with the SEC, Ripple is quickly redeploying its global strategy with the help of the regulatory-friendly frontier of the Middle East. The XRP Ledger, as its technological hub, is taking on multiple roles from payment infrastructure, stablecoin settlement to asset tokenization. If Ripple can successfully promote the "tokenization as a service" model, the Middle East may become an important testing ground for it to break free from regulatory shadows and achieve the integration of DeFi and TradFi, as well as asset on-chain.