Ripple On-Demand Liquidity (ODL): How It Works and Who Uses It

Ripple On-Demand Liquidity (ODL) is the core commercial product that drives real-world XRP usage. Unlike SWIFT, which requires banks to maintain pre-funded accounts in foreign currencies (nostro/vostro accounts), ODL uses XRP as a bridge currency to source liquidity on-demand — reducing the capital locked in cross-border payment infrastructure.

The Problem ODL Solves

Traditional cross-border payment requires correspondent banking: if a bank in Mexico wants to send USD to a bank in the Philippines, it typically goes through a US bank with relationships in both countries. Each step requires:

Pre-funded nostro accounts in the destination currency
Manual reconciliation between banks
Multiple intermediary fees (each bank takes a cut)
1–5 business days for settlement

The global banking system has an estimated $27 trillion locked in nostro accounts serving this function. This capital earns little return and creates massive inefficiency.

How Ripple ODL Works

ODL uses XRP as a bridge asset in a three-step process:

Convert source currency to XRP: The sending institution converts USD (or local currency) into XRP on a regulated crypto exchange in the source country
Send XRP across borders: XRP is transferred on the XRP Ledger in 3–5 seconds to an exchange in the destination country
Convert XRP to destination currency: The receiving exchange immediately converts XRP to the local currency (e.g., Philippine Peso) and delivers it to the recipient’s account

The entire process takes seconds. The sending institution never needs to hold PHP — it only holds XRP for the duration of the transaction (typically under 10 seconds). This eliminates the need for pre-funded nostro accounts.

ODL Corridors in 2026

Ripple has expanded ODL to 40+ payment corridors worldwide. Key corridors include:

Corridor	Key Partners	Primary Use Case
USD → MXN (US-Mexico)	Bitso, MoneyGram	Remittances from US workers to Mexico
USD → PHP (US-Philippines)	Coins.ph, PDAX	OFW remittances (2nd largest remittance market globally)
EUR → AED (Europe-UAE)	Lulu Exchange, Tranglo	Business payments, labor remittances
AUD → INR (Australia-India)	IndusInd Bank, Tranglo	Diaspora remittances
USD → BRL (US-Brazil)	Novatti, Bitso	B2B cross-border payments

Who Uses Ripple ODL?

MoneyGram

MoneyGram was Ripple’s highest-profile ODL partner until their agreement ended in 2021 (MoneyGram cited the SEC lawsuit as a concern). However, MoneyGram has since resumed working with Ripple products as the legal situation resolved.

Tranglo

A Singapore-based cross-border payment specialist that handles hundreds of millions of dollars in ODL volume annually, connecting Southeast Asian corridors.

Bitso

Mexico’s largest crypto exchange and a key ODL infrastructure provider for the US-Mexico corridor — one of the world’s highest-volume remittance routes.

SBI Remit

SBI Holdings, a major Japanese financial group and significant Ripple investor, uses ODL for Japan-Southeast Asia corridors.

ODL Volume Growth

Ripple reports ODL volume in its quarterly XRP Markets Reports. Key milestones:

2020: ODL launched commercially; minimal volume
2021: Over $600M per quarter in ODL transactions despite the SEC lawsuit
2022–2023: Growth slowed due to legal uncertainty but continued in non-US markets
2024–2026: Resumed strong growth following settlement; new corridors in Africa and South Asia

ODL vs SWIFT: The Core Comparison

Feature	Ripple ODL	SWIFT
Settlement time	3–5 seconds	1–5 business days
Pre-funded accounts needed	No	Yes ($27T locked globally)
Transaction cost	<$0.01	$15–$50
Availability	24/7/365	Business hours
Transparency	Full real-time tracking	Limited

What ODL Means for XRP’s Value

Every ODL transaction creates real, non-speculative demand for XRP. The transaction flow — buy XRP, transmit, sell XRP — creates buying and selling pressure simultaneously, which normally suppresses price impact. However, as ODL volume grows:

More XRP is held in exchange order books to facilitate transactions
Deeper liquidity attracts more participants, creating a virtuous cycle
Institutional confidence in XRP’s utility grows, supporting long-term price

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Bottom Line

Ripple’s On-Demand Liquidity is the commercial engine behind XRP’s utility value. By using XRP as a bridge currency, it eliminates pre-funded nostro accounts and delivers cross-border payments in seconds at near-zero cost. ODL has grown to 40+ corridors and continues to expand into new markets. As ODL volume grows, so does organic XRP demand — making it a key metric for XRP investors to track.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice.

Ripple’s CEO has been instrumental in expanding ODL — read our Brad Garlinghouse profile for the full story.