Ripple Labs strengthens its presence in Japan and draws on long-standing relationships with the country's traditional financial institutions. The strategy aims to increase adoption and interest in the XRP Ledger (XRPL).
This week, Asia Web3 Alliance Japan and Web3 Salon Japan launched the Financial Infrastructure Innovation Program. The initiative is designed to support Japanese startups developing next-generation, regulated digital financial solutions on the XRP Ledger.
Ripple's Japan strategy tests whether institutions can lift XRP
The program opened for applications on December 19 and offers a grant of $10,000 per startup. It is narrowly focused on three valuable areas: stablecoins, tokenization of real assets, and credit infrastructure.
“Japan offers a tremendous opportunity for blockchain-based innovation, supported by a forward-thinking regulatory framework and a large talent pool. This program represents Ripple's commitment to building a vibrant ecosystem where startups can leverage the speed, low costs, and reliability of the XRP Ledger to create tangible benefits and transform financial infrastructure,” said Christina Chan, Senior Director of Developer Growth at RippleX.
Analysts see it as a reasonable way to identify candidates for Ripple's significantly larger capital fund, including the $1 billion XRP fund dedicated to developers in Japan and Korea.
The program has received support from a significant number of established players, including Mizuho Bank, SMBC Nikko Securities, and Securitize Japan.
Despite the initiative's strong support from the business community, it comes at a challenging time for the network. While Ripple boasts institutional adoption, the underlying usage of XRPL tells a conflicting story where activity is declining.
According to data from DefiLlama, the Total Value Locked (TVL) on XRPL has dropped significantly in recent months. TVL has decreased from the peak in July of $120 million to around $62 million at the time of writing.
This nearly 50% drop indicates that capital is retreating from the network's DeFi protocols even as partnerships expand.
Meanwhile, the decline in the broader cryptocurrency market has likely contributed to the downturn, as Bitcoin has fallen 30% from its peak in October of over $126,000.
Additionally, the push for asset tokenization faces strong competition. According to Rwa.xyz, XRPL currently ranks ninth globally in terms of tokenized assets, with approximately $213 million in assets.
Although this is significant, it lags far behind networks like Ethereum and new competitors that have captured most of the RWA market.
Considering this, the JFIIP program is more than just an accelerator for startups. By anchoring itself in Japan's banking infrastructure, Ripple hopes to create a robust ecosystem that is immune to the speculative volatility of the broader cryptocurrency market.
