Ripple is currently the second most popular cryptocurrency token in the market, with a market capitalization of $14.5 billion. In January 2018, Ripple reached its all-time high at $3.56. Although the token has fallen significantly, with a valuation of 36 cents, Ripple has captured a lot of attention in the market as cryptocurrency experts believe there is a lot of potential and growth for the company.
This belief stems from the fact that Ripple is consistently adding new clients, such as large banking corporations from all around the world. Furthermore, more and more financial institutions are keen to test Ripple’s protocol to transfer money internationally. Ripple’s large value is the reason why many experts see the token as highly undervalued, especially since it will continue to add new clients to the Ripple network and will grow to increase its market cap and value tremendously.
In 2018, Ripple managed to partner with a number of significant banks and payment providers including Israel’s GMT, Turkey’s Akbank, American Express, Earthport and MoneyGram. A great example is Ripple’s partnership with Western Union. According to the Daily Hodl, the remittance giant believes that it’s ready to add cryptocurrencies as a payment option for its customers.
Western Union president Odilon Almeida mentioned that “Western Union is ready today to adopt any kind of currency. We already operate with 130 currencies. If we one day feel like it’s the right strategy to introduce cryptocurrencies to our platform, technology-wise it’s just one more currency. I think cryptocurrency may become one more option of currency, or assets, around the globe to be exchanged between people and businesses. If that happens, we will ready to launch.”
Western Union is currently in a position where it could bridge the gap between fiat currencies and cryptocurrencies. It has access to billions of bank accounts with 500,000 retail agent locations. While Western Union is optimistic when it comes to cryptocurrencies, they’re less positive when it comes to Ripple’s cross-border payment technology.
The company has been testing Ripple since 2015. The CEO Hikmet Ersek, unfortunately, mentioned that the company’s tests with xRapid were too early and too small to draw firm conclusions. Ashees the Senior Vice President of Product at Ripple noted that the lack of results was not because of the technology but because Western Union was only testing with 10 transactions.
Ripple has however had positive pilot trial runs with other finance companies. According to Carlos Carriedo, the General Manager of American Express, “In a matter of seconds, through this test, our clients were able to transfer funds in a very transparent and seamless way, from one part of the world to the other.”
Although Ripple is building out strong partnerships, many banks are still reluctant to use Ripple’s xRapid due to a lack of regulatory clarity. Marjan Delatinne, the Head of Ripple banking noted that non-financial institutions are more interested in using xRapid to process cross-border payments than banks because the regulatory framework around the usage of digital assets is not very clear for banks. Payment service providers and other financial institutions are, however, less governed by these obligations.
While Ripple is doing well to grow their community, strategic partners, and attract great talent, the team still has a lot of work to do to get banks to integrate their systems. If Ripple’s goal is to have their technology completely integrated into the banking system, they need to ensure that they continue making strong industry partnerships and secure major players in the banking and fintech industry who will give them custody and ensure that the Ripple token is on top of their list. If Ripple can deliver on these requirements, Ripple could become the most popular and dominant token in 2019.
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Do you think 2019 will be the year where it could even overtake Bitcoin as the dominant token?
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Disclaimer: Cryptopig content is written by a team of blockchain passionate people. We are not registered as investment advisors. Don’t take the information in this post as investment advice and make sure you do your own research before investing.