Ripple CEO: One bank will use XRP in 2018
Citing faster speeds and cost efficiencies, Ripple is sure at least one bank will use xRapid in the next six months.
Ripple’s chief executive Brad Garlinghouse has advanced claims that at least one financial institution will adopt and implement the XRP cryptocurrency token as a means of liquidity to support payment flows.
During an interview this week at CB Insights Future of Fintech 2018, Garlinghouse said he was “100%” positive that in the short-term there will be implementation of XRP, via the company’s xRapid platform, among banks.
“We expect, this year, for at least one bank to use XRP in their payment flows, to use xRapid,” he said.
“The reason is, it’s faster, it’s cheaper and so, why wouldn’t someone use it?
“JP Morgan Chase are one of the largest liquidity providers on the planet, Citibank are one of the largest liquidity providers on the planet. So do I think for a dollar/yen, dollar/euro… no, no, no, no. If you go talk to a lot of banks around the world, they’re paying Citibank for liquidity, they’re paying JPM for liquidity.”
Garlinghouse advocated that if these smaller institutions switched to a product like xRapid to fund real-time liquidity, utilizing XRP as a bridging currency, they may be able to reduce costs and increase independence.
XRP, like many digital currencies, has often been labelled impractical due to its inherent volatility. However, Ripple’s CEO argued that because XRP transactions – approximately three seconds – were “100,000 times faster” than a regular wire transfer – approximately three days – the risk of price instability is greatly reduced.
“XRP is very uniquely positioned to solve that cross-border payments problem,” Garlinghouse said.
Over the last year, Ripple has engaged several different payment providers to pilot XRP transactions via xRapid.
XRP is not a security
Garlinghouse went on to liken the XRP token to that of bitcoin and ether, in that it is not a security asset. Last week, the US Securities and Exchange Commission (SEC) officially stated that, as cryptocurrencies, bitcoin and ether were not recognized as tradeable securities under current federal government regulations.
Garlinghouse provided three key arguments as to why XRP is not a security.
“If Ripple, the company, shut down tomorrow, the XRP ledger would continue to operate. It’s open source decentralized technology that exists independent of Ripple. Secondly, if you buy XRP, purchasers don’t think they’re buying shares in Ripple. Buying XRP doesn’t give you access to dividends or profits. Third, XRP is solving a problem. There’s no utility in a security,” he said.
Ripple’s distributed ledger, RippleNet, provides real-time messaging, plus financial clearing and settlements. Ripple has already signed over 100 partners who utilize its RippleNet blockchain.
For the first time, retail customers in the United Kingdom can now make one-day Euro and US dollar payments to Euro Zone countries and the United States, respectively, using Santander’s new Ripple-powered mobile app.
Earlier this month, Ripple committed over $50 million to fund the collaborative University Blockchain Research Initiative (UBRI), designed to pursue academic advances and technical innovations in blockchain.
XRP doubled its share of the overall market capitalization of all cryptocurrencies during the first quarter of the year, according to the latest financial reports released in April, a continuation of a trend first started in 2017.
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