Opinion: New data has emerged that suggests that customers of Ripple may be able to switch to xRapid, the company’s premier offering utilizing XRP for liquidity, with ease. A document titled “What’s New with xCurrent 4.0” has been released which shows off a bevy of new upgrades for xCurrent such as a new UI, bulk FX purchasing, zero downtime and “increased product interoperability”.
This marks an interesting development in the cycle of Ripple’s products, as some of their biggest clients utilize xCurrent for payments. This includes 11 of the world’s biggest banks, and settlement giants such as American Express, MoneyGram and Western Union. Their banking customers include MUFG, the world’s fifth largest bank managing assets worth $2.6 trillion, Credit Agricole, Europe’s third-largest bank, Bank of America, Santander, Standard Chartered, SBI Group, Westpac, and Mizuho Financial Group.
Multi-hop payments and xRapid’s role in it:
This also echoes statements made by employees at Ripple, who have stated that it is easy for existing RippleNet customers to make the transition to xRapid once regulatory clarity is achieved with respect to XRP’s position as a digital asset. Currently, over 150 members are signed on to Ripple’s network of banks, payment providers and financial institutions known as RippleNet.
Other features that are said to be included in the new version of xCurrent include support for multi-hop payments, a technology that Ripple has recently been flaunting. Multi-hop payments allow for the sourcing of liquidity through XRP without the need for banks to have one-to-one relations with those who can utilize xRapid. This is generally considered as an easier way to source liquidity through xRapid, and also provides XRP HODLers something to cheer for, as it directly translates to more capital flowing through the network.
Multi-hop can also provide faster and cheaper payments across RippleNet, with the company also promising to deliver a “seamless payment experience. Dilip Rao, Ripple’s Global Head for Infrastructure Innovation, stated during the launch:
“Milestone in the scaling of RippleNet! Now any regional bank can act as a correspondent bank, connecting originators and beneficiaries with multiple intermediate legs, yet with full transparency of data and an atomic (single) settlement across all legs. Fees down, speed up!”
Cory Johnson, the Chief Market Strategist for Ripple, provided clarity on the company’s rollout of their products, stating:
“I expect our rollout would be…most will be xCurrent, a little bit will be xRapid, and even less will be xVia. Over time that might change, but initially, the oldest stuff gets the most traction, because customers have had a chance to look at it the longest and get used to the idea more quickly.”
This provides an interesting outlook, as it means that the maximum number of Ripple’s clients who utilize xCurrent for cross-border payments have the opportunity to easily interoperate with xRapid to source liquidity. This opens up new avenues for financial institutions, allowing them to free up the capital held in nostro and vostro accounts by utilizing XRP to provide on-demand liquidity in conjunction with multi-hop.
Benefits of switching:
Combining this with the presence of xVia, Ripple’s third product which allows for onboarding to RippleNet through a single API provides a fast track of sorts for financial institutions to begin utilizing xRapid. Moreover, the fact that utilizing xRapid is one switch away will provide a fruit just out of reach for financial institutions currently.
Over the pilot results for xRapid, those who trialed the product reported an exponential increase in speed along with a 40-70% decrease in fees. This boldly incentivizes existing customers to take charge and beginning processing payments through xRapid. As explained by Asheesh Birla, the Senior VP of Product at Ripple:
“They would use xCurrent and they would get rid of the need for the FTP server and the three-day wait to process the files. The magic is where xRapid is available, Mexico for example. They can then add on xRapid and move money on-demand using XRP into Mexico and payout instantly.”
Other features mentioned in the document include enhanced onward forwarding to allow for final mile visibility on payment status, easier counterparty peering through API workflow automation, and improved auditing and monitoring services. All in all, this provides good competition to SWIFT’s Global Payments Initiative, which is set to be implemented in all partner banks by the end of this month.
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