Can We Trade IQD to XRP?

 

A viewer on the channel wrote the following: 

@onelife1636 

This is good news. XRP acts as the universal “middleman currency”, so the Iraqi Dinar can be converted directly into XRP, and XRP into another currency, for example, VND, without needing USD in between. This speeds up payments, lowers costs, and simplifies international transactions.

The channel researched the subject, and this is what we learned:

Yes, the concept you're describing is largely accurate in theory, but it depends on real-world adoption and infrastructure.

Here's how it works:

XRP as a bridge currency:
Ripple Labs, the company behind XRP, designed it to act as a neutral bridge currency. This means two parties can exchange less commonly traded currencies (like the Iraqi Dinar – IQD – and the Vietnamese Dong – VND) by converting IQD → XRP → VND, without needing USD as an intermediary.

Potential Benefits:

• Faster settlement: XRP transactions settle in seconds.

• Lower fees: Avoiding multiple intermediaries (like correspondent banks using USD) cuts costs.

• Liquidity: If XRP has enough liquidity in both currency pairs, the transaction is seamless.

But here's the catch:

1. Liquidity is key:
   For XRP to act as a bridge between IQD and VND, there must be active markets (liquidity pools) for both:

   • IQD/XRP

   • XRP/VND

   These markets are not widely available or deep today. Most centralized exchanges and Ripple's On-Demand Liquidity (ODL) partners don’t yet support niche fiat currencies like IQD or VND directly.

2. Regulatory and banking infrastructure:
   Banks and money transmitters must be part of the RippleNet system and be willing to use XRP. Many countries still operate under conservative or unclear crypto regulations.

3. USD is still dominant:
   Even when RippleNet is used, USD is often still involved, especially when XRP liquidity is lacking. For now, USD remains the default intermediary in many corridors

In summary:

• Technically true: XRP can serve as a bridge between IQD and VND, without USD.

• Practically limited: This functionality is only fully available in corridors where XRP liquidity exists, and Ripple’s network is adopted by local partners.