Ripple has worked hard to spread its wings. Now considered one of bitcoin’s primary competitors, the currency says it has struck deals with banks and money-transfer platforms like MoneyGram to ensure its survival and stretch beyond the standard horizons of digital currency usage, but how valid are its claims of late?
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The company allegedly sold approximately $91 million of its currency XRP in the fourth quarter, and prices saw a surge of nearly 30,000 percent in 2017. Trading volume has also reportedly jumped by about 35,000 percent in recent months, suggesting its popularity is spiking faster than anyone could have predicted.
Indeed, the Ripple team recently announced that over $800 million USD in XRP transactions are occurring daily.
“XRP markets ended the year with a statement – one that will likely be remembered as a defining milestone in XRP’s history,” the company exclaimed.
The widespread attention is derived from the project’s alleged transaction speeds. Mercury FX founder Alastair Constance had the following to say when describing Ripple and its respective currency:
“Digital assets promise fast transaction speeds, but XRP is far faster than all of them, including bitcoin. Cutting settlement times from hours and days to just three seconds or less will remove billions of dollars in unnecessary, intermediary fees.”
Despite the positive hype, one can’t ignore the flies buzzing about in Ripple’s ointment.
Ripple has often claimed to possess a vast network of banking partners, yet one source states that several financial institutions deny having any interest in using XRP, and that Ripple’s stance as “bitcoin for banks” is virtually moot. Thus far, seven banks – some of which have even allegedly partnered or been partnered with Ripple – claim they would never entrust their corporate customer payments to a cryptocurrency or the technology supporting it.
“It’s bewildering,” says founder of ConsenSys Joseph Lubin. “Effectively, it’s a totally useless token, except that it is being used by that company to make a lot of money to fund some of their activities.”
MuchBetter payment company co-founder Jens Bader recently argued along similar lines:
“Ripple is somewhat off the pace, both in terms of its market position and its identity as a cryptocurrency […] “It might be a good complimentary currency to bitcoin and ethereum, but since it is a centralised system, it does not live up to the brief of what a cryptocurrency is meant to do, and the USPs of blockchain technology.”
Additionally, of the 100 banks that have supposedly joined Ripple’s outgoing XRP network, Ripple CEO Garlinghouse will only name one – Stockholm-based Skandinaviska Enskilda Banken AB, which has announced that it will be “moving commercial payments” over Ripple’s network.
Lagging evidence has often caused online rifts between Ripple executives and doubters like New York Times journalist Nathaniel Popper, who claims that the company repeatedly exaggerates its power and continued growth.
Do you believe Ripple is the company it says it is? Post your comments below.
Images via Twitter, Ripple, BBC