By David Drake
Ripple, a company based in San Francisco, had a difficult start in 2018. The virtual currency, XRP, has lost about 70% of its value since the start of the year due to the wide cryptocurrency crash that took place in January. But things are now looking up for XRP as the list of financial institutions, including banks, that are testing Ripple technology continues to increase.
Woori Bank in South Korea is among the new banks that have completed tests on cross-border transactions on the Ripple blockchain platform. Media reports show that the bank, through its Digital Strategy Department, plans to commercialize the XRP platform even as it launched the second trial phase.
This development comes just weeks after Western Union confirmed that it was testing the Ripple money transfer technology.
Andrew Hacker, Founder of Thought Network Ltd, says, “The market for remittance payments is estimated at around $400 billion. Western Union is primarily focused on remittance payments of immigrants sending money home. It already has a large share of customers using their services and has a wide reach across the globe, so they don’t have to worry too much about customers switching to new services.”
Ripple has previously attributed its blockchain system to fast speeds at lower costs. If this works well, adoption of the system by Western Union could boost its XRP currency significantly.
“For Western Union, using Ripple and integrating it into their system will be a huge boost for Ripple. If they are able to prove that they can lower fees, this will just further ignite the use of Ripple and ultimately increase its market cap. When a company is able to implement technology that allows it to drastically lower fees they pass on to their users, it is a great thing for that business,” Hacker adds.
More Ripple Trials
At the same time, news have emerged that Fleetcor Technologies, providers of fleet and workforce payment has began running trials of xRapid, a product of Ripple. This comes barely a month after IDT, a telecom provider and Mercury, a payments provider signed up to run trials of the Ripple blockchain platform.
Another money transfer giant, MoneyGram, is also piloting Ripple to test its efficiency and speed for making international payments. All these trials are likely to increase Ripple’s value in future.
“Any integration news in this space is big news so I can definitely see this helping Ripple’s value.” Todd Nichols, Lead Digital Strategist at Assettoken, says.
Disclaimer: David Drake is on the advisory board for most of the firms mentioned or quoted in this article.