The financial startup, Ripple, is the owner of the cryptocurrency XRP. This altcoin is the third most valuable cryptocurrency, behind Bitcoin and Ethereum, according to data obtained from CoinMarketCap.
Ripple has recently signed up more clients to its blockchain network, with the total now around 100. Its distributed ledger network, RippleNet, has been joined by the likes of UAE based lender, RAKBANK, and UK based currency exchange firm, IFX. The firm has also gained traction in South America, where it has been signed up by a local online payment provider, dLocal.
Blockchains are huge encrypted groups of data that are dispersed all over the globe and record information regarding the transactions of digital currencies. This proves to be a much more effective and discreet method of transferring payment, as compared to contemporary financial process, which involves scrutiny from different financial and government departments. Blockchains are faster as they are less managed.
The CEO of Ripple, Brad Garlinghouse, hopes that the recent round of financial customers that joined RippleNet will allow Ripple to undermine the dominance of financial institutions and banks over financial transactions.
While talking to the CNBC, Garlinghouse states:
"The global payments industry really has been ruled by an oligopoly, led by players like JPMorgan and Citi."
While discussing the negative comments of big financial institutions such as JPMorgan and Goldman Sachs, Garlinghouse replied:
"It's certainly not that surprising to see Jamie Dimon's comments recently on bitcoin given that they (JPMorgan) control that oligopoly."
Jamie Dimon is the CEO of JPMorgan and recently called Bitcoin a fraud that will eventually blow up.
Cuallix will be the first one to pilot XRP
In the recent round, Cuallix, which is a Mexican non-bank financial services firm, joined RippleNet. It has been announced that Cuallix will be the first institution to use Ripple’s cryptocurrency. Ripple explains that XRP is one of its most liquid assets due to its low transaction fees and instant payment transfers.
The contemporary payment techniques of banks require them to pre-fund local currency accounts all over the world to allow faster transfer of payments. By using Ripple’s XRP, Cuallix will be able to considerably reduce the cost of transactions from US to Mexico, as explained by Garlinghouse.
Garlinghouse believes that this is the tipping point for the blockchain industry and the startup has gained interest from some big-time clients such as Standard Chartered, UniCredit, and Santander.