Stripe and a payments startup just co-authored a protocol that gives XRP a job Ripple’s own stablecoin cannot yet do, and it has nothing to do with moving money between people.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
XRP (CRYPTO:XRP) serves three key functions. It facilitates payment settlements between currencies, acts as collateral for positions at prime brokers, and more recently, it covers expenses for software agents. The latter function was introduced through a standard co-authored by Stripe and Tempo, using XRP in a way Ripple’s own dollar stablecoin has yet to achieve.
As of September 18, XRP is trading at $1.32, up 16.97% over the past month but down 29.69% year to date. Despite its volatility, the case for holding XRP is based more on its utility than its market price. So, what does XRP do, and which of its functions currently facilitates money movement?
XRP as a Payment Asset
The XRP Ledger was designed to transfer value between currencies without the need for a correspondent bank, an intermediary often involved in traditional wire transfers, which typically incurs a fee and delays. XRP transactions settle within seconds for just a fraction of a cent.
Ripple’s dollar-backed stablecoin, RLUSD, runs on similar infrastructure, giving the payments sector a regulated currency for transactions. Launched in December 2024, RLUSD currently has about $2.4 billion in circulation, a 50% increase in just one month, aided by approvals from the New York Department of Financial Services, the Dubai Financial Services Authority, and Luxembourg under MiCA. Daily transaction volume grew from roughly $200 million in January to approximately $750 million in August.
However, approximately $1 billion of RLUSD circulates on the XRP Ledger, while around $1.4 billion operates on Ethereum. This indicates that Ripple’s stablecoin is more active on a competing platform than on its own. Overall stablecoin circulation has surpassed $300 billion this year, placing RLUSD at less than 1% of the market.
Payments represent XRP’s oldest and most established use case, with transaction capabilities in operation since 2012. Currently, RLUSD facilitates about $750 million in transactions daily.
XRP as Collateral
Using collateral involves pledging an asset to support a position instead of liquidating it. Holders seeking leverage or wishing to trade can post XRP and maintain their investment exposure. If the position is profitable, the XRP is returned intact, and if not, the XRP may be liquidated to cover losses.
Jazzi Cooper, head of product at RippleX, describes the use of XRP as collateral for institutional credit as a “killer use case,” and Ripple has invested significantly to develop this capability. The acquisitions include Hidden Road for $1.25 billion, now rebranded as Ripple Prime, which clears approximately $3 trillion annually for over 300 institutional clients. Additional deals involved $1 billion for GTreasury in October 2025 and $200 million for the payments platform Rail.
Institutions can currently use XRP as collateral for trades but cannot yet borrow against it. The XLS-65 and XLS-66 lending standards are drafted and awaiting validator approval, and their dual-pool model would allow institutions to borrow RLUSD while retaining their XRP.
It’s important to note that a prime broker accepting collateral only serves counterparties already clearing through it, whereas including a lending standard in the ledger opens opportunities to anyone holding the token. Therefore, the validator vote is a critical date to monitor.
XRP as the Settlement Asset for AI Agents
Ripple developed the first two XRP applications. The third, known as the Machine Payments Protocol (MPP), was co-authored by Stripe and Tempo, and XRP plays a crucial role in a technical detail of this protocol.
An “agent payment” refers to transactions executed by software without human approval. Under MPP, when a service receives a request from an agent, it responds with a price. The agent approves this price, and the service then delivers the requested item or service. On September 17, Ripple released version 1.1 of the XRPL AI Starter Kit, adding support for MPP and the Open Wallet Standard.
Payment Channels are the XRP Ledger’s native mechanism for streaming small amounts and batching them into a single settlement at the end, and they handle ongoing sessions for agents using XRP. In contrast, RLUSD only accommodates one-off payments. Extending payment channels to stablecoins will require a future XRPL upgrade with no announced date, which is why XRP settles the streaming sessions rather than the stablecoin.
In June, Ripple also added support for x402, a standard originated by Coinbase and backed by Stripe, Coinbase, and Cloudflare. This protocol has processed between 75 million and 120 million machine payments recently, totaling millions of dollars. The cost per transaction averages a fraction of a cent, which demonstrates the need for a new settlement layer. Ripple also joined the x402 Foundation as a premier member alongside Coinbase, Circle, AWS, Google, Mastercard, Stripe, and Visa, and is a launch partner for Mastercard’s Agent Pay for Machines.
The XRP Ledger 3.3.0 upgrade introduced Permission Delegation, allowing one account to grant limited transaction authority to another without exposing the main private keys. This means developers can provide a wallet to an agent without transferring the entire account.
Which of the Three Moves Money Today?
Payments have been facilitating money movement for many years. Collateral is currently operational at Ripple Prime, where institutional counterparties conduct trades. The lending standards needed to expand this service await validation. Agent payments are still in beta and do not yet have live commercial volume on Stripe’s merchant services.
On March 17, the SEC and CFTC designated XRP as a digital commodity. Ripple’s settlement with the SEC concluded in August 2025 and cannot be reopened, establishing a legal foundation for all three use cases.
Anyone holding XRP is essentially betting that one of these three applications will grow enough to positively impact the price. Payments are the most established but change slowly, collateral is focused on institutional users and depends on a validator vote that has not happened yet, and agent payments represent the newest and least proven application.
The latter is particularly significant, as it could transform XRP from a cryptocurrency traded primarily by individuals into one used mainly for machine-to-machine transactions. The cost of this bet is patience, as the newest application currently lacks revenue, while the oldest has been gradually growing for a decade.
Contact [email protected] for any questions or corrections.