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The (still) San Francisco-based company Ripple Labs Inc. is constantly criticized. One of the main reasons is the high percentage of XRP held by the company. Much of this XRP is being used again and again to incentivize other companies and partners. For Ripple itself, this is an extremely cheap financing method that relies on high XRP inventory.
One example is Ripple’s partner MoneyGram, which also pays in XRP. You can find out how much it costs and what MoneyGram does with it in the article.
If you want to read more details about Ripple and find out why MoneyGram sells XRP the moment it receives, download our companion app for free, available for both iOS and Android devices. The Born2Invest mobile app brings you the latest market updates and the world’s top business news so you can stay informed.
MoneyGram and XRP: no interest in cryptocurrency
On October 29, MoneyGram released its latest quarterly data for the third quarter of 2020, indicating that the company had received a total of $ 9.3 million from Ripple.
Through transactional spending, the company remains a net benefit, or net profit, of $ 8.9 million from Ripple.
However, instead of talking about profit, the positions are listed as a “market development fee”. As a reminder, MoneyGram is paid proportionally to the transaction volume converted with Ripple’s ODL system. In other words: MoneyGram benefits when XRP is used in conjunction with ODL.
But a look at the previous quarter’s data shows a decrease in the amount received. So MoneyGram received less money from Ripple. This in turn means that MoneyGram has converted less transaction volume via ODL. At least in the context of MoneyGram, XRP is used less this quarter than the previous quarter.
However, anyone who now thinks the payment provider would keep XRP is wrong. In an exclusive interview with TheBlock, a MoneyGram executive revealed that XRPs will be sold directly as soon as the company receives the cryptocurrency.
While the relatively small sum of $ 9 million won’t create a dump in the XRP price, this fact shows quite rightly why the selling pressure at Ripple (XRP) is so high.
Ripple’s identity problem
Ripple CEO Brad Garlinghouse has faced criticism of XRP, the third largest cryptocurrency measured by market capitalization.
Garlinghouse confirmed that Ripple has “absolutely no plans” to change its strategy regarding cryptocurrency, which it says solves a $ 10 trillion problem: cross-border payments.
“Ripple has absolutely no intention of” undoing “our strategy. Using XRP to solve a real $ 10 trillion problem how cross-border payments works. “
On August 12, the Finance Times, one of the most popular business newspapers, ran a not-so-flattering article about how Ripple is trying to restore its business and become “the Amazon of Crypto” without a successful product now that XRP is it has not taken hold of the embankments it has taken hold.
For example, Spanish banking giant Santander doesn’t want to use XRP for international payments, even if it uses Ripple’s software.
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(Featured image of vjkombajn through Pixabay)
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