Over the past few months, Ripple has been expanding its list of partnerships. Many financial service companies are testing the startup’s proprietary RippleNet blockchain payment solution.
For example, we recently had the news of two large payment providers including Moneygram and LianLian also signing joining the network.
Now, Ripple has added another Bank and payment processing company to their test pool. FLEETCOR subsidiary, Cambridge Global Gayments has signed up to use Ripple’s Xrapid technology whereas India-based IndusIand bank has joined RippleNet.
While these are no doubt positive signs of adoption, how substantive are these agreements?
Cambridge Global Payments
Cambridge is a large payment provider with over 13,000 clients around the world. They process over $20bn in international payments on a yearly basis. The hope is that with xRapid, they can make use of XRP to provide much faster cross border payments. According to Mark Frey who is the COO at Cambridge Global:
We look forward to exploring how Ripple can help us continue to improve the customer experience using new technology
This was not the only Ripple product that was of interest to the company. According to the Ripple announcement, Cambridge global was also exploring the possibility of using xCurrent which is the software that Ripple uses for international transaction settlement and messaging.
Indusland bank is a large commercial bank based in India that has a great deal of international remittances. Given the laborious nature of buying and selling local currency as well as the relatively dated bank routing protocols, the bank was in need of an alternative solution.
This is why they have signed up to join the RippleNet enterprise blockchain network. This currently has over 100 partners signed up with banks such as Itaú Unibanco in Brazil or InstaReM in Singapore. RippleNet will now connect Indusland to all these other banks in a number of emerging countries.
According to the senior vice president at Indusland, Ramesh Ganesan, they will now be able to leverage the platform to deliver instant settlements with atomic confirmations. He went on to say:
Building a Digital platform that enhances client experience is a core part of our strategy and we are confident that our partnership with Ripple is another step in that direction. This will deliver more value to remitters, recipients & our Institutional partners across the world
What Does this Mean for XRP
While these developments are no doubt positive for Ripple, the company, the impact on the price of XRP are less than certain. For those who do not know, XRP is the liquidity token in Ripple’s xRapid protocol.
Banks have so far opted to rather make use of the technology of the xRapid protocol without having to adopt the XRP token. This is perhaps why the price of XRP has been rather stagnant of late. These announcements used to be met with large rallies in Ripple that drove XRP to new all-time highs.
The hope, however, is that these partnerships are seen as the first step towards the large scale adoption of XRP. Although banks are not using them now, they have all indicated an interest in using it to some degree in the future.
If the XRP token it to replace only a minor percentage of fiat currency that is currently used to provide cross border liquidity, then demand is likely to hugely outstrip supply. This makes the conditions ripe for XRP price appreciation.
This is the hope that many Ripple enthusiasts are holding out for.
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