XRP News: Will Ripple Customers Move to the New xRapid Payment Option Over xCurrent?
Investors in XRP are thinking carefully about the direct influence on the coin by Ripple.
Blur93, a Reddit user, asked why users of the Ripple platform still prefer to use their international payment option xCurrent, as opposed to the more recent cross border option of the xRapid.
Marjan Delatinne, the global head of banking at Ripple, stated that ten of the over two hundred financial institutions that are members of RippleNet are presently using XRP payment options.
Banks Still On Xcurrent
In an explanation on why financial institutions especially banks will take more time to make the xCurrent – xRapid switch Delatinne said:
“Just to make clear, no banking institution is using that (xRapid), because as you’ve probably heard about, the regulatory framework around the usage of digital assets is not very clear for banks. But payment service providers and some other financial institutions are less governed by these obligations.”
Ripple’s Plans For Xrapid Adoption
David Scharwtz, the chief technology officer at Ripple talked about Ripple’s long term plans for the improvement of the adoption of international xRapid payment solution.
“As this system gets adopted by financial institutions, more and more payments will be able to be bridged by XRP the minute XRP has the liquidity to bridge them. Then, we just have to pick a strategic corridor (one with good volume but also fairly high costs in the traditional settlement space) and incentivize a huge pool of liquidity to XRP in that corridor. Then those payments will settle through XRP because the payment system is already ready for it.
This is a way to solve that chicken and egg problem. Next we hang more assets off the corridor we already built. Then companies that have to make lots of payments into various destinations in those corridors will find they can save money by holding XRP. Then traders will want to hold XRP because that’s the asset anyone paying into those corridors needs. And so on. Wherever liquidity pops up, payments will settle through that liquidity.”
Ripple, presently has two active xRapid payment routes, Mexico and the Philippines, with plans on adding more later in the year.
Reasons For Xrapid Move Delay
In response to why Ripple customers have not made the move to xRapid by Blur93 on Reddit, Reddit users gave several reasons, one of which was by zoromx, who responded by giving two major reasons
“1- As some people already mentioned, Xrapid is still a new product.
2- Regulation. We are still early in blockchain adoption and until there is not clear law regulation will be difficult for banks to adopt XRP, since it involves a digital asset and if something goes wrong with regulation, it would imply a rollback that could cost hundreds of millions for them.
Also consider laws differ by country, and since the main purpose for XRP is for cross border payments, a clear law must exist at both points of the transaction”.