The growth of blockchain technology and cryptocurrency has been phenomenal in the financial sector. It has changed the way we perceive money and has made it better. The traditional banking system is slow and full of loopholes. Blockchain technology has the ability to address these shortcomings and enhance it for the better.
Banks and other financial institutions have realised the massive potential of this industry, hence central banks are racing to utilize the various benefits that cryptocurrencies have to offer.
As more businesses across different industries are starting to decentralize their processes to save costs and attain profitability, traditional banks also had to follow suit and decentralize their operations in the face of cutthroat competition from cryptocurrencies.
Multiple blockchain companies are now engaging with traditional financial institutions thereby boosting the possibilities of exploring new uses cases using blockchain and crypto. Ripple has been a key player in this sector as more than 200 banks and financial institutions are using Ripple’s financial products to provide transparent and real-time visibility of transactions to all stakeholders.
RippleNet is enabling banks to process cross-border payments while making the process faster and a lot cheaper. It has announced partnerships with SendFriend, JNFX, FTCS, Ahli Bank of Kuwait, Transpaygo, BFC Bahrain, ConnectPay, GMT, WorldCom Finance, Olympia Trust Company, Pontual/USEND, and Rendimento.
Ripple’s On-Demand Liquidity (ODL) product, which was previously known as xRapid, has also been a huge success. ODL leverages XRP as a bridge between two different currencies and thus eliminating the need for any kind of pre-funding.
Moneygram, the global money transfer giant has been implementing Ripple’s ODL in their daily operations since June 2019. Since then its use has grown to handle 10% of MoneyGram’s total transaction volume between the United States and Mexico.
The company executives have always been confident about their products. Ripple CEO Brad Garlinghouse had already revealed how the company wants to bring more banks and financial institutions into the cryptocurrency space. Speaking at a recent SWELL event, Garlinghouse said:
“We wanted to bring banks, financial institutions, into the opportunities represented by these new technologies, and you know frankly, starting with the deep end, I will say that the deep end is going all the way into using digital assets to solve some of these problems as opposed to gradually working them into that.”
Garlinghouse further expects the world’s top 20 biggest banking institutions to hold and trade digital assets as early as 2020. While he is bullish about Ripple’s real-life use cases, he isn’t so sure about the rest in the lot. He believes there will be some consolidation among the crypto companies and clarified:
“The world doesn’t need 2000+ digital assets. While I don’t think there will be one coin to rule them all, it’s clear that if an asset doesn’t have a proven use case beyond speculation, it is not going to survive.”
Besides Ripple, other blockchain companies are also enhancing the present-day economy. It is quite evident that blockchain technology is changing the banking industry due to the advantages it has over the fiat currency system. It doesn’t come as a surprise that financial institutions are increasingly incorporating blockchain technology into their opera