Ripple has always promoted XRP as an innovative solution for cross-border money transfers – however, interest from banks in XRP for such uses has remained muted. Thus, in mid-2019, Ripple came up with the idea of contributing $50 million to MoneyGram, a financial services provider focused precisely on international money transfers. MoneyGram was to become the reference case for XRP, but the liaison only lasted until March 2021.
Earlier this month, Ripple and MoneyGram declared their separation, the background to the December 2020 lawsuit against Ripple by the U.S. Securities and Exchange Commission over XRP. The SEC vs. Ripple case is ongoing, and meanwhile, Ripple has apparently found a replacement for MoneyGram. In a blog post, Ripple announced it would acquire a 40 percent stake in Tranglo.
Tranglo confirmed the move in its own press release, as well as the core message that this means Tranglo’s operations will use XRP for cross-border remittances as a bridge currency. Tranglo operates mainly in the Southeast Asian region and reported about 20 million executed money transfers for 2019 with a total volume of about $4.6 billion.
Like MoneyGram or Western Express, it relies on partner offices in many countries that also accept cash and make it available for withdrawal elsewhere in a matter of minutes. This method is particularly popular among migrant workers, for example, in order to support their families who have stayed at home.
Read more about a possible partnership between Ripple and Tranglo and find the latest business news with our companion app Born2Invest.
Ripple and Tranglo – liberation blow for XRP?
Ripple and Tranglo pointed out that the deal still needs the approval of authorities. No details are given about the amount of money Ripple will pay for its shares in Tranglo. When the deal is completed, two high-ranking Ripple executives are expected to join Tranglo’s board. While Ripple already has a representative office in Asia and also services some clients in the region for its network through that office, they are forgoing XRP.
At least on paper, Ripple’s investment therefore sounds logical, but a more accurate valuation is not yet possible. In the case of the MoneyGram investment, in addition to the entry price, which many considered excessive, it later turned out that Ripple was only able to motivate MoneyGram with significant bonus payments in XRP for the bridge currency.
Conclusion: XRP and Ripple continue to fear for the future
The news of Ripple’s investment in Tranglo could not discernibly affect the price of XRP, which has been stuck at prices around $0.50 since the SEC lawsuit. Whether U.S. judges will accept Ripple’s plans with Tranglo and XRP as proof that XRP really should be classified as a crypto bridge currency rather than a security (securities) remains questionable.
At least, however, Ripple is demonstrating its ability to act with Tranglo in a situation that hangs over XRP like a sword of Damocles in the US.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in BLOCK-BUILDERS.DE, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
PagaPhone Seeks to Facilitate Remittance Collection and Boost Financial Inclusion in Mexico
PagaPhone, which already has pre-authorization from the National Banking and Securities Commission to operate as an electronic payment fund institution,...
Rovi Shoots Up 72% its Profit in the First Half of 2021
The Spanish pharmaceutical company Rovi achieved a net profit of $60.3 million (€51 million) from January to June, compared to...
Four Million Round for the Italian Real Estate Crowdfunding Portal Walliance
The Italian real estate equity crowdfunding portal Walliance has closed a $4.73 million (€4 million) round. This is the third...
What Artificial Intelligence Means for Us Today?
Advantage of AI counts the smarter artificial intelligence which promises to replace human jobs, freeing people for other pursuits by...
Credit Suisse: Major Bank Admits Gold and Gold Mining Stocks are Undervalued
Precious metal investments like gold are often overlooked in exchange for more ‘exciting’ opportunities. As a result, they are frequently...
Crowdfunding7 days ago
Trusters’s Real Estate Crowdfunding Fund Raised €7.3 Million in Six Months
Crypto7 days ago
Elon Musk Said Tesla Will Accept Bitcoin Again
Featured7 days ago
How Rating Discrepancies Undermine ESG
Biotech7 days ago
UrbanFisio Launches Virtual Assistant to Surpass €1 Million by 2021