Ever since cryptocurrencies appeared in the financial landscape, they have proven to be highly efficient instruments to transact with. An average operation with a cryptocurrency usually lasts just a few minutes, an issue that the banking sector has been definitely fighting against for so long, and that’s without including the extremely high fees the sector charges per transaction, another problem cryptocurrencies have managed to solve.
In this matter, one of the cryptocurrencies that have shown remarkable advances with respect to cross-border payments is without any doubt Ripple (XRP). Through Ripple Labs, the company has created a package of solutions integrated on products such as xCurrent and xRapid, products that attack specific problems of the industry such as privacy of the data, costs, speed, and liquidity.
Ripple has managed to collaborate with several bank institutions across the globe; is currently partnered with at least 100 banks, and the truth is, this seems to be just the beginning. Ripple has stated its next primary goal is that major bank entities would fully adopt their product xRapid at the end of the year, a fact that, of course, puts Swift, the current cross-border payment platform in use, in not the best position.
Let’s see how this rivalry goes!
The first touché of Ripple
Back in April, Ripple made an audacious move by partnering with one of the largest banks in the world, Banco de Santander. The agreement was to collaborate in the elaboration of a blockchain-based service that would allow the users of the bank in the UK, Spain, Poland, and Brazil to make transactions using different currencies.
The strategic alliance represented a breaking point for Swift as Banco de Santander is one of the major bank entities in the world. And if we count the signings the company is doing with financial institutions every day; the current payment platform has for sure everything to lose.
As a matter of fact, Ripple has managed to ally with at least 100 banks to the date, among we can find, of course, the mentioned Spain bank which now appears very happy with the results of the collaboration with Ripple.
Regarding that, the head of operations, technology, and innovation of the bank, Ed Metzger, stated the results were very positive, he said,
“We have had very positive feedback and good take-up. It gives the customer much more certainty over how much money will arrive in the destination account.”
The blockchain has demonstrated to be a much cheaper, quicker, and efficient technology when it comes to treating cross-border payments, so this can definitely mean a check warning for the correspondent banking system Swift.
The Swift’s Reply
As it was expected, Swift decided to counterattack and made some improves in its messaging platforms, at the time that started as well the testing of the blockchain technologies to give Ripple a taste of its own medicine.
However, as the test that involved 34 bank entities from all around the world concluded, it all appears like it would be tough to fulfill the scalability goals using a blockchain system, which proves, of course, the skepticism the company keeps regarding the cutting-edge technology.
Regarding this, the head of banking at Swift, Harry Newman, said that the,
“Blockchain technology is not straightforward to scale and it is not yet appropriate to do so”
He continued and commented that he understands the correspondent banking model is an old-fashioned invention of 1998, but when it comes to speed, Swift has already managed to do payments in just a matter of minutes using the Global Payment Innovation system.
“If you don’t have money on the blockchain you are just doing a different kind of messaging system for correspondent banking”
The main issue in the crypto sphere and its solution
As we know for a fact, the primary concern of the crypto community and the focus of many of the detractors of the sector focuses on the volatility cryptocurrencies have shown during its existence. In this matter, a more prominent commented solution has been the creation of the dubbed ‘stablecoins,’ an invention that may not be so far from its inception.
The idea is to build up a cryptocurrency token backed by fiat currencies deposited at central banks across the globe. As of the moment, Circle, the cryptocurrency, and payment group based in Boston have already started a project to create the USD coin, the first crypto of the ‘stablecoin’ type.
Although this project is very much unlikely to solve the situation between Ripple and Swift, it may offer a solution for one of the most significant issues of the industry.
For the latest cryptocurrency news, join our Telegram!
Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Pxhere.com
Cryptocurrency Collateralized Debt Positions Are Growing in Popularity
While Bitcoin (BTC) continues to hover around the magical 10,000 price level, altcoins continue to fight an uphill battle. Simply put, hopes of a future bull run continue to diminish as Bitcoin maintains its dominance. One school of thought is that a few altcoins will survive and flourish, but which ones are anyone’s guess. That being said, it’s hard to go wrong picking against the top coins like Ethereum (ETH), Ripple (XRP), Litecoin (LTC), and EOS. These projects have managed to find a foothold in the market and have a better chance than most of staying there. While traders wait for their positions to increase in value, one opportunity that may be worth looking at is initiating a collateralized debt position.
What is a Cryptocurrency CDP?
In traditional terms, a CDP is essentially putting up collateral in order to receive a loan against the deposited amount. There are several examples of this in our day to day lives. Auto title loans from large companies like TitleMax are extremely popular with consumers. Consumers are essentially able to use their car as collateral in exchange for a cash payment which can then be used for whatever needs the consumer has. The consumer can continue using their car as long as debt payments are made.
The same concept applies to cryptocurrency CDPs. Consumers are able to put up crypto tokens, such as…
Hodium Presents a Compelling Opportunity for Outsized Investment Returns
I’m sure all of us remember the cryptocurrency glory days of 2017 and early 2018. It was one of the biggest bull runs in history and created incredibly wealth for quite a few early entrants. Unfortunately, for most of us, those gains have most likely been wiped out during the altcoin apocalypse. The truth is that traders probably thought a bit too highly of their trading abilities when the reality was that anyone could have thrown a dart at a board and ended up making money.
As markets mature (and the crypto market is definitely maturing) it becomes more and more difficult to generate alpha. In that regard, it’s similar to traditional financial markets. I can remember trading during my high school days. It was the late 90s and right in the middle of the dot.com boom. Eventually, however, the euphoria fades away and reality hits hard. Now, it’s become rather difficult to actually trade profitably which has given way to the rise of hedge funds.
Hedge funds are investment funds that pool capital from accredited and/or institutional investors and invest in a variety of assets, often with extremely complex portfolio-construction and risk management techniques. The professionals employed by hedge funds are the best of the best and have spent years honing their craft. That is why they’re able to make the millions of dollars that they normally…
KaratGold Proves Its Business Model By Providing Official Documents
There has been a lot of renewed enthusiasm in the cryptocurrency market thanks mainly to Bitcoin’s strong move about 10,000. Although Bitcoin continues to show its dominance, the altcoin market has yet to benefit from that rally. A few of the largest altcoins remain popular but the rest of the market continues to lag behind. In 2018, there was a lot of talk regarding a possible altcoin apocalypse where only the strong would survive. That prediction appears to be playing out as expected. Going forward, only the best projects that have a real world need will survive. Crypto traders will have to spend a lot of their time doing proper research in order to find the best opportunities, just like in all financial markets. One promising project that appears to have the makings of a future winner is KaratGold Coin.
KaratGold Coin is a cryptocurrency developed by the reputable German company Karatbars International, which maintains a leading position in the market of small gold items and investments. The project is part of a larger ecosystem, which involves several blockchain solutions that can be used for transactions, communication, investing and other tasks. During the past few weeks, however, the KaratGold ecosystem has been a target of unsavory scam allegations.
Karatbars International and GSB Gold Standard Banking Corporation…