- The blockchain-focused startup, Ripple Inc. continues to funnel millions of dollars’ worth of XRP to global remittance firm, MoneyGram.
- The San Francisco-based firm channeled $9.3 million in XRP tokens to MoneyGram over the third quarter of 2020, representing a $5 million decrease from the previous quarter.
The latest MoneyGram financial results released on Thursday show Ripple Inc. made a payment of $9.3 million in market development fees to the remittance service provider. The company received a net benefit of $8.9 million after a partial offset of $0.4 million in “transaction and trading expenses”.
The payment is made every quarter since the partnership between Ripple Inc. and MoneyGram in 2019. According to a MoneyGram spokesperson, the firm gets paid the fee for facilitating and processing transactions on Ripple's On-Demand Liquidity (ODL) product, which uses XRP for settlement.
However, this represents a drop from the $15.1 million paid out in Q2 2020, signaling a drop in transactional volume on Ripple’s ODL platform.
The recent payment brings the total amount paid to MoneyGram to $52 million adding to the $16.1 million in XRP paid in Q1 2020, and a total of $11.3 million paid out in the last half of 2019. According to an insider in MoneyGram, the company does not hold any XRP but rather sells it as soon as they receive it.
In mid-June 2019, Ripple announced a strategic partnership with MoneyGram that would see the latter benefit from Ripple’s cross border trading services and foreign exchange settlement using the XRP token. Furthermore, Ripple invested $50 million into MoneyGram in exchange for equity to kick start the partnership.
The partnership between the two payment firms is expected to last till 2023.