In a previous post, I wrote about the ISO 20022 standard and its relevance to the future of the financial system. This time, I want to explain why some cryptocurrencies that comply with this standard have an “X” at the beginning of their name. Examples include XRP, XLM, and XDC, three of the leading cryptocurrencies being considered in the context of the new quantum financial system.
ISO 4217 is the international standard that defines three-letter codes for currencies worldwide, widely used in the financial and banking sector to uniformly identify different currencies. For instance, USD is the code for the U.S. dollar, while EUR is for the euro.
Although this standard was created for traditional currencies, it has been adopted by certain cryptocurrencies seeking greater integration with the traditional financial system. Cryptocurrencies like XRP, XLM, and XDC use codes based on ISO 4217, reinforcing their goal of facilitating international payments and being recognized in the banking sphere.
XRP (Ripple)
XRP, the token of the Ripple network, is primarily used to facilitate value transfers between financial institutions. Its code follows the structure of ISO 4217, where currencies not issued by a government tend to begin with an “X.”
In the case of XRP, the “X” indicates that it is not issued by a country or centralized authority. This convention has been adopted by XRP due to its focus on becoming a bridge liquidity asset for international transactions, similar to traditional currencies.
XLM (Stellar Lumens)
Stellar is another cryptocurrency designed to facilitate cross-border or micro payments, focusing on financial inclusion. Like XRP, XLM uses the “X” prefix in accordance with ISO 4217, identifying it as a digital currency not issued by a state.
The use of XLM is geared toward transferring money between different currencies in a fast and efficient manner, making its adoption within traditional financial systems more accessible.
XDC (XinFin)
XDC is the native token of the XinFin network, a hybrid blockchain platform focused on financial transactions for businesses and governments. Like XRP and XLM, XDC uses the “X” prefix, highlighting its decentralized nature. XinFin focuses on trade finance solutions and seeks to integrate its blockchain network into traditional systems, hence the adoption of a standard like ISO 4217 to facilitate its use.
In conclusion, the use of ISO 4217-compatible codes by cryptocurrencies like XRP, XLM, and XDC reflects their ambitions to integrate with the global financial system and be recognized as legitimate instruments for transferring value. The adoption of this standard is a crucial step in achieving greater interoperability with financial institutions and increasing acceptance in global markets.