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Ripple Labs has redoubled its efforts to strengthen its presence in Japan, building on its long-standing relationships with traditional financial institutions in the country. This strategy aims to increase user adoption and interest in the XRPL book.
This week saw the Asia Web3 Japan Alliance and Web3 Salon launch the Japan Financial Infrastructure Innovation Program. This initiative aims to support Japanese startups developing next-generation compliant digital financial solutions on the XRPL registry.
Ripple’s strategy in Japan tests whether institutions can raise the value of XRP
The opportunity to apply for the program was available on December 19, and provides a grant of $10,000 to each startup. The program is tightly focused on three high-value areas, including stablecoins, tokenization of real-world assets, and credit infrastructure.
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Christina Chan, Senior Director of Developer Growth at RippleX, said Japan offers a tremendous opportunity for blockchain innovation, supported by an advanced regulatory framework and an abundance of talent. She explained that this program represents Ripple’s commitment to create a vital system in which startups can take advantage of the speed, low price and reliability of the XRPL registry to achieve realistic benefits and transform the financial infrastructure.
Analysts see the program as a low-cost way to identify candidates for Ripple’s large-cap funds, including its $1 billion XRP fund, dedicated to developers in Japan and Korea.
The program received support from a strong group of established players, including Mizuho Bank, SMBC Nikko Securities and Securitiesite Japan.
Despite the great support of the companies for this initiative, it comes at a critical moment for the network. While Ripple is promoting enterprise adoption, XRPL’s underlying usage data suggests a different, deflationary story.
Data from Defy Lima indicates that the total locked value (TVL) in the XRPL registry has decreased significantly in recent months. The total value has declined from its July peak of $120,000,000 to about $62,000,000 at the time of writing.
This decrease of almost 50% indicates that capital is leaving the network’s DeFi protocols even as institutional partnerships develop.
The broad decline in the cryptocurrency market in turn contributed to this decline, with Bitcoin falling 30% from its October peak of more than $126,000.
In addition, asset tokenization steps face strong competition. Rwa.xyz reports that the XRBL registry is currently ninth in the world in tokenized assets, with assets valued at approximately $213,000,000.
While this is a large number, it remains significantly behind networks such as Ethereum and new competitors that have taken the lion’s share of the real world asset market.
With this in mind, consider that JFIIP is more than just a startup accelerator. By installing itself banking infrastructure in Japan, Ripple hopes to create a cohesive ecosystem immune to speculative fluctuations in the overall cryptocurrency market.
