Last week we saw how as Ripple rose above a dollar for the first time in its history, the cryptocurrency filled all the headlines. XRP started the year 2017 worth around one cent and now it is trading at one dollar. Banks in Japan and South Korea are testing the use of Ripple technology for faster transactions. On Tuesday, the major Japanese bank SBI Holdings and some of the largest credit card companies announced plans to create an association in which participants shared the history of transactions and verified payments to each other, using the blockchain of Ripple.
THE GIANTS OF CREDIT CARDS
JCB, Sumitomo Mitsui Card and Credit Saison are some of the big companies that will participate in this association. Known for its agreements with traditional financial institutions, Ripple and its technology could help lower costs in addition to curbing fraudulent activity.
Ripple has positioned itself well in the landscape of cryptocurrencies, offering financial institutions quicker and cheaper transactions. Its value, however, depends on whether it becomes a service that banks want to use.
Starting in January, SBI Ripple Asia, JCB and ten other companies will start testing blockchain and artificial intelligence. Card companies could use blockchain technology mainly to identify verification, as well as to curb fraudulent transactions.
COORDINATED TRANSACTIONS
In addition, the card companies hinted at the possible issuance of their own virtual currency based on blockchain. Something that will probably speed up transactions even more. However, Ripple is much more technologically advanced than many tokens issued by banks. Its niche market and lucrative partnerships place XRP in a good position to revolutionize the financial industry.
SBI Ripple Asia has already launched a federation of 61 banks and has begun testing blockchain payments through institutions. This movement provides the basis for a better use of blockchain technology in the industry and could also involve cheaper transfers.
Ripple's close relationship with the financial giants could raise the price of XRP as more banks decide to use the currency for their day-to-day business activities.