Ripple appoints CME man to grow XRP into a viable currency
30 November 2016 | 5283 views | 0
Ripple is proud to announce another addition to our team: Miguel Vias, head of XRP markets.
In his new role, Vias will utilize his considerable expertise building liquidity for new financial products by working with market makers, traders, investors and exchanges to strengthen the XRP markets and set the stage for large-scale institutional adoption.
Global financial institutions are increasingly looking for solutions to consolidate the liquidity tied up with the nostro accounts required to fund their overseas payments. Digital assets allow for banks to fund their payments in real-time, and in the process, cut down their dependency on nostro accounts. A strong XRP reinforces these economics.
Vias joins us from CME Group, where he was global head of precious metals and metal options at the largest precious metals desk in the world. Prior to the CME, Miguel honed his craft at the commodities desks of Morgan Stanley, Bank of America, and Mitsui. He brings nearly two decades of trading experience to our team.
We talked with Vias about what brought him to Ripple, and what he’s most excited to do in his new position.
What made you decide to get into fintech, or come to Ripple specifically? This is a little bit of a career change for you, so can we talk about what interests you about this position?
My interest in fintech goes back to early 2012. While I was working in London, I’d begun to hear about bitcoin. A borderless currency without a central counterparty was theoretically appealing, but I had my doubts, especially given the complex systems bitcoin on its own was attempting to replace.
Still, the blockchain and distributed financial technology could clearly solve some interesting problems. Two years after joining CME, I came across Ripple and XRP, and immediately knew I’d found something. Ripple and XRP removed most of the initial reservations I had around bitcoin, namely that there was an actual group of people focused solely on integrating into the financial system, instead of displacing it.
Since I bought my first XRP two years ago, I’ve kept a close eye on everything Ripple- and XRP-related and have been impressed with the progress the company has made. From building the team, to the product, to the market infrastructure, it’s obviously the best blockchain-focused fintech startup in the world. So when I had the opportunity to become part of the team, there was no way I was going to pass it up.
How does your experience in commodities translate to working with XRP?
XRP is uniquely qualified as a liquidity solution, to help banks and corporates currently holding balances in nostro accounts all over the world to facilitate payments without trapping their cash. As a digital asset, it can reduce the amount of capital in float. As a bridge currency, it can enable liquidity concentration around fewer currency pairs, making cross-border payments more efficient.
Looking at it through the lens of my experience, XRP’s commodity and foreign exchange characteristics (specifically its limited supply) makes it very similar to precious metals. The considerations around inventory and delivery that make trading a digital asset like XRP unique are also at the core of the commodities markets. As a result, my understanding of precious metals, especially when it comes to market structure, will be ever more helpful as we increase the access to, and liquidity of, XRP. Additionally, my experience in OTC markets and at an exchange will aid in charting a path toward wholesale XRP adoption. Similar to other digital assets, XRP exists in an interesting hybrid of OTC and exchange-traded markets. If we want to transform XRP into an institutionally viable currency, it’s crucial to understand how both those markets function individually, how they complement each other, and how we can leverage a deep understanding of both to further develop XRP.
What about your new role is most exciting to you? What do you think the future of digital currency will look like?
As I mentioned, I think the natural ethos of digital currencies actually limits their utility and thus general adoption. In order for any currency, digital or not, to achieve critical institutional adoption requires a team of people to manage its progress. As a thought experiment it might be comforting to think that open source adoption is possible, but the reality is much more complicated.
That’s a lengthy prelude to what I find most exciting about the role, which is being primarily responsible for ensuring XRP achieves institutional adoption. The idea that I will be part of the team which will help grow the first institutionally useful digital currency is amazing. As for the future of digital currencies or distributed ledgers generally, I think we will continue to see usage increase in more institutional areas.
The role XRP plays in reducing the capital needed to fund cross-border payment businesses is equally applicable to any cross-system or cross-asset transaction. Beyond the foundational use case of payments, digital assets will lower collateral requirements across the whole of the capital markets, for example, with securities settlement, derivatives markets, and repo lending.
A digital asset may well be included in baskets of world reserve currencies in the years to come. It will take some time, and a ton of effort, but I have no doubt in the very near future we will live in a world where much of our existence will revolve around digital currencies and distributed ledger technologies.
With regards to XRP, what can we look forward to in the future?
We’re planning to launch a quarterly XRP update that will focus on the state of the market, XRP deal structures and sales targets. Most importantly, our intent is to make XRP more broadly accessible by listing it on additional exchanges. So, stay tuned! I can’t wait to get started.