MoneyGram reports $11.3 million in revenue as a result of its Ripple partnership
According to the recently submitted annual report to the U.S. At the Securities and Exchange Commission, MoneyGram’s revenue is only $ 11.3 million as a result of partnering with Ripple.
Embracing Ripple has been positive for MoneyGram
Although MoneyGram’s total revenue decreased, embracing Ripple was beneficial to the company. MoneyGram began using RippleNet’s On-Demand Liquidity (ODL) in the second quarter of last year. And this proves that they are very successful.
The report stated:
“The Company is compensated by Ripple in XRP for developing and bringing liquidity to foreign exchange markets, facilitated by the ODL platform, and providing a reliable level of foreign exchange trading activity.”
Notably, out of the $ 11.3 million received from Ripple, $ 8.9 million came in the fourth quarter. With the overall growth of the Ripple platform, this number could have increased even more by 2020. Ripple Labs pays the remissions company as an incentive to use RippleNet in its operations.
This activity is positive evidence that Ripple Labs seeks to use any means necessary to enable financial institutions to use its services. It reports paying to other partner organizations as well. In the case of MoneyGram, such payments are intriguing, as Ripple Labs already owns a sizable portion of the company. The arrangement to use RippeNet expires in 2023.
Ripple’s strategy of bringing banking partners into its ecosystem is working
MoneyGram’s embrace of Ripple indicates that the company recognizes the paradigm shift that is taking place in the global financial sector. The Blockchain asset is increasingly playing a role in moving money around the world and threatening to make traditional money transfer providers obsolete. Eliminating the need for companies like MoneyGram is Bitcoin’s core design feature.
By actively seeking to partner with fiat-based financial institutions, Ripple Labs is a new exception in the cryptocurrency space. However, CEO Brad Garlinghouse has repeatedly stated that cryptocurrencies will be best used as a complement to the legacy economy, at least for the time being. In other words, Garlinghouse doesn’t see the central banks, and the money they cast will soon disappear.
Ripple’s strategy of bringing banking partners into its ecosystem is working, but the extent to which these organizations use RippleNet is still unclear. Very few people seem to be beyond the research stage. The fact that Ripple had to pay them to use it underscores this truth.
Currently, both Ripple and MoneyGram benefit from their alliance. However, both companies certainly understand that much more significant changes will soon have a substantial impact on both of their core operations.
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