It seems Ripple’s many naysayers may soon be forced to eat their words, after a successful trial of the company’s much touted xRapid technology. Following the venture’s partnership with Mercury FX and Viamericas, they have finally been able to prove the ability of their XRP coin to foster faster and more economical cross border payments, and the implications of this could be significant.
Using the xRapid platform, a number of businesses participating in the trial were able to send money across the globe, in far less time than it would take to use more conventional methods. This means Ripple’s purported ambition – to offer “on-demand liquidity” to its users – could soon become a reality for enterprises around the world.
A more economical option for businesses everywhere
According to research from the Pew Center, around $600 billion is sent from America to overseas family and friends each and every year. Though these amounts are often small, they nonetheless carry high processing and conversion costs, so that the combined factors of high demand and high fees mean overheads can exceed $30 billion per annum.
This is where the XRP coin and xRapid technology enter the equation. By using the former as an intermediary, companies and private individuals will be able to significantly reduce their costs. Based on the data currently available, this could enable businesses to save between $12 and $21 billion a year.
It’s not only commercial outfits that would benefit. There would also be a knock-on effect for consumers, with the lowering of costs translating to cheaper goods and services, and the improved technology providing safer and slicker online and cross border transactions.
This would positively affect not only obvious industries such as retail, but areas like online entertainment too. Take some of the online casinos reviewed on this page, for example. Deposits and account totals would be made instantly accessible to those at both ends of the transaction, with business and client mutually benefitting from the introduction of the technology and the impact of on-demand liquidity.
Faster and safer transactions
xRapid technology undoubtedly has the potential to improve online and cross border transactions all across the globe, and this latest trial has helped to prove that Ripple’s sales pitch is far more than just empty claims. In fact, the data shows the average xRapid payment takes just two minutes to complete, compared to processing times of up to two days under the fiat system it aims to replace.
In addition to lower costs and quicker payments, it also has the ability to make cross border payments safer and more secure than ever before, and this is all down to its blockchain technology. Storing information on a public, unalterable ledger, the upshot is that each payment becomes a block, one linked into a truly unbreakable chain.
The overall result is a promising one: a payment system that’s smooth, streamlined, and secure, not to mention cost-effective. As Paul Dwyer, co-founder and CEO of Viamericas, explains: “It’s clear that xRapid can lower liquidity costs while increasing payment speed and transparency in a way that facilitates rigorous compliance controls.”