Tag: moneygram

Visa's New Debit Card Rumored to Use XRP for Payments

According to an announcement made yesterday, Moneygram had liaised with Visa with plans to launch a peer-to-peer debit card service. This was made known in the details of the recent news of the acquisition of payment service operator MoneyGram by Ripple. There was a lot of anticipation by the XRP community that this debit card might make use of XRP token for fast transfers. 

Head of MoneyGram, Alex Homes said that with this new collaboration, they intend to create the best platform that provides ease and best user experience for sending and receiving money across the globe. Currently, the US is the only country the Debit card is available in.

Visa and MoneyGram are making plans to extend the reach of the project to other regions as well. There seem to be reasons to believe that XRP could be adopted as a payment method, given the link-up between MoneyGram and Visa, with Ripple being affiliated with the former.

MoneyGram currently makes use of Ripple’s xRapid to make payments around the globe using XRP as a means of payment when it goes beyond the US. However, Ripple has not made any comments/remarks regarding these speculations.

Image via Shutterstock

Ripple Invests in MoneyGram Equity Honoring Commitment to Accelerate and Expand On-Demand Liquidity

MoneyGram has announced that Ripple has made the final $20 million investment in MoneyGram equity pursuant to Ripple’s original $50 million equity investment commitment made earlier this year. 

In a press release on Nov. 25, it was announced that Ripple purchased the newly-issued equity from MoneyGram at $4.10 per share, paying a significant premium on MoneyGram’s market prices. The funding will support MoneyGram’s operations as the company continues to increase volume and use of On-Demand Liquidity, Ripple’s product that leverages the digital asset XRP.

“Our partnership with Ripple is transformative for both the traditional money transfer and digital asset industry – for the first time ever, we’re settling currencies in seconds. This initial success encourages us to expedite expanding our use of On-Demand Liquidity,” said Alex Holmes, MoneyGram Chairman and CEO. “Partnerships with companies like Ripple support innovation and allow us to invest in creating better customer experiences. I anticipate furthering our growth into new corridors and exploring new products and services.”

MoneyGram is currently moving approximately 10 percent of its Mexican Peso foreign exchange trading volume through On-Demand Liquidity and has already started transacting in four additional cross-border corridors, including Europe, Australia, and the Philippines since the partnership with Ripple was announced in June 2019. 

Earlier this year, Ripple made an initial investment of $30 million in MoneyGram equity at the same time that it signed the commercial agreement with MoneyGram for cross-border settlement using digital assets. After this most recent $20 million investment, Ripple will own 9.95 percent of the outstanding common stock of MoneyGram, and approximately 15 percent on a fully-diluted basis including non-voting warrants held by Ripple.

Image via Shutterstock

XRP Status Classified as Unclear, Meanwhile Analysts Say XRP Price Could Jump to $0.30

The US Commodities and Futures Trading Commission (CFTC) Chairman Heath Tarbert indicated in an interview that the status of XRP had been classified as unclear. He said, “It’s unclear. Stay tuned I’d say. Part of the issue is that our jurisdiction we share with the SEC (Securities and Exchange Commission). If it’s a security, it falls under their jurisdiction. If it’s a commodity, it falls under ours.” 

Tarbert also added that the CFTC and SEC would be working together to classify the status of various cryptocurrencies. According to Tarbert, Bitcoin and Ethereum are classified as commodities. XRP, however, does not fall into this classification, as the token is used on RippleNet by Ripple to enable fund transfers globally, and has been used as a store of value.  

Is XRP ready to push above its resistance? 

XRP has been staying in the mid $0.20 region, proven to be a strong support level prior to its drop to $0.18 in Q4 2019. The bullish trend in the crypto market has been positive for major altcoins such as XRP to push against a key resistance. If the resistance is broken in the next few days, it could lead to a significant spike reaching new multi-month highs.  

Crypto Rand, a crypto analyst said that he believes that XRP could push upwards past $0.30. 

Popular crypto analyst stated in a tweet, “XRP – 6 month RSI technical level broke yesterday, here is where the 6 month descending trend line rejected yesterday but very likely breaks up today.” 

MoneyGram’s expansion into India, a win for Ripple’s adoption 

MoneyGram, a multinational payment remittance platform previously partnered with Ripple, for its on-demand liquidity for cross-border transactions. Using XRP is the bridge between two fiats for transactions, this ensures a faster and more efficient transfer. This resulted in MoneyGram’s improved speed of the settlement of transactions, as XRP adoption also increased.  

MoneyGram recently partnered with EbixCash, to expand the former’s presence in India. According to a press release, it states that Ebixcash is owned by a software application product supplier, who is responsible for MoneyGram’s expansion into the Indian market. As MoneyGram will get access to more consumers in India, the company will also get access to hit the rural areas in the country.  

Alex Holmes, MoneyGram’s CEO believes that Ripple’s on-demand liquidity could be a game-changer, although it is currently in its early days. Ripple has already put together a list of partners who are using or planning to use on-demand liquidity. 

Image via Shutterstock

Western Union Makes Offer to Acquire Cross-Border Payments Firm MoneyGram

Financial giant, Western Union is in discussions to acquire cross-border payments company MoneyGram according to a June 1 article by Bloomberg.

Western Union Co. is seeking to acquire MoneyGram International Inc. in a transaction that would bring together two of the largest US providers of cross-border payments. The news comes via an anonymous Bloomberg source, who the publication cannot identify as the matter has not been made public – according to the source familiar with the matter.

Officials representatives from both companies have declined to comment on Western Union’s alleged takeover offer for cross-border payments company MoneyGram.

COVID Climate and FinTech Competitors

MoneyGram’s business has been in decline as more and more people lean towards online payments. Financial Technology (FinTech) payment services are now offering solid competition to the established cross-border payments companies and policymakers are intent on bringing down fees associated with moving money around the world.

The onset of the coronavirus pandemic disruption has put MoneyGram under further duress and the cross-border payments company has been forced to close many of its operations around the globe.

Earlier this year, Ripple made an initial investment of $30 million in MoneyGram equity at the same time that it signed the commercial agreement with MoneyGram for cross-border settlement using digital assets. After this most recent $20 million investment, Ripple now owns 9.95 percent of the outstanding common stock of MoneyGram, and approximately 15 percent on a fully-diluted basis including non-voting warrants held by Ripple.

The deal seemed to be motivated by the FinTech competition and online trends of consumers during COVID, MoneyGram attempted to boost its digital remittance services but according to their first quarter report for 2020, digital cross-border remittance only made up just under 20% of their business.

Image via Shutterstock

MoneyGram Continues to Receive Millions in Development Fees From Ripple

Ripple continues to pump money into MoneyGram remittance services in market development fees.

Blockchain payments firm Ripple has invested a further $9.3 million in market development fees to MoneyGram remittance services.

According to MoneyGram’s financial results for Q3 2020, after a deduction of $0.4 million in transaction and trading expenses, the money sender saw a net benefit of $8.9 million come from Ripple.

In 2018, MoneyGram became one of the biggest firms to publicly say it was piloting Ripple’s XRP cryptocurrency in its remittance services.

The latest investment from Ripple—which provides various payment products and services to financial institutions—follows a $50 million investment in November 2019 and a further $15.1 million in Q2, 2020 from the blockchain payments firm to MoneyGram.

All investments from Ripple to MoneyGram have the stated purpose of “market development fees” which MoneyGram says are compensation for providing liquidity to Ripple’s On-Demand Liquidity (ODL) network.

Ripple’s On-Demand Liquidity (ODL) network is the blockchain firm’s payments product that focuses on cross border payments leveraging Ripple’s XRP cryptocurrency.

Alex Holmes, MoneyGram Chairman, and CEO spoke on the partnership with Ripple in a release last November.

Holmes said:

“Our partnership with Ripple is transformative for both the traditional money transfer and digital asset industry – for the first time ever, we’re settling currencies in seconds […] Partnerships with companies like Ripple support innovation and allow us to invest in creating better customer experiences. I anticipate furthering our growth into new corridors and exploring new products and services.”

In 2018, MoneyGram became one of the biggest firms to publicly say it was piloting Ripple’s XRP cryptocurrency in its remittance services.

Ripple to Cash In One-Third of its Stake in MoneyGram

Leading blockchain payments company Ripple plans to sell a third of its stake in American money transfer firm MoneyGram. Ripple currently has a stake of $6.22 million or 8.6% of outstanding shares in MoneyGram as published by the U.S. Securities and Exchange Commission (SEC).

Pumping Ripple’s On-Demand Liquidity into MoneyGram

The SEC further expounded that Ripple has a warrant to purchase additional shares amounting to 5.95 million. As a result, the total equity stands at 12.2 million shares. Based on this information, Ripple is cashing in nearly 4 million shares or nearly 33.3% of its whole stake. Nevertheless, once the deal is sealed, the blockchain payments giant will still own 4.44% or about 3.22 million shares of MoneyGram.

In November 2019, Ripple finalized its $50 million equity investment commitment. It purchased the newly-issued equity from MoneyGram at $4.10 per share and paid a significant premium on MoneyGram’s market prices. The funding was to support MoneyGram’s operations as the company continued to increase the volume and use of On-Demand Liquidity, Ripple’s product that leverages the digital asset XRP.

Ripple continues making headway

Despite the sale of a third of its stake in MoneyGram, Ripple has previously pumped in huge investments in this company. For instance, Ripple invested $9.3 million in market development fees to MoneyGram remittance services. Precisely, after a deduction of $0.4 million in transaction and trading expenses, the money sender saw a net benefit of $8.9 million come from Ripple.

After emerging from the shadows with its bullish run, Ripple’s XRP token more than doubled in price within a week span. As a result, outperforming Bitcoin (BTC) and Ethereum (ETH) because it surged by 110% on CoinMarketCap.

On a monthly perspective, the cryptocurrency has more than tripled in value, as it began the month of November at lows of 20 cents. In comparison with Bitcoin and Ethereum, which have both recorded weekly gains of 10% and 20%, respectively, Ripple has had the best run of the three cryptocurrencies.

Furthermore, Ripple’s blockchain-powered XRP ledger is touted to be superior to the SWIFT financial network adopted by banks worldwide because it is more secure, cheaper, and more transparent. 

MoneyGram CEO Praises Ripple XRP for Providing Speed and Efficiency for Cross-Border Payments

MoneyGram CEO Alex Holmes praised Ripple for the innovation it was providing to the blockchain and cryptocurrency space.

In an interview with CNN’s Julia Chatterley, Holmes discussed how far MoneyGram has come this year and said that the output of MoneyGram’s online services this year has doubled that of its walk-in business in the United States. The expansion and enhancement of its digital business have recorded significant growth during the coronavirus pandemic, as MoneyGram has doubled the payments this year alone, with a 220% increase in application transactions.

Holmes also discussed his firm’s partnership with Ripple and said that it was transformative and a move towards innovation. With Ripple technology, the company has been able to explore solutions for faster payment settlement networks. He said:

“We’ve been partnering with Ripple now for about 18 months, and the idea behind that was to really push innovation and see how we can help in the pioneering, the expansion and global utilization of blockchain […] Our customers are looking for real-time payout and so the money has to be there, really before the transaction is initiated.”

In 2018, MoneyGram was among the first to announce that it was testing Ripple’s XRP token for its remittance services. While Ripple on its end has been more focused on delivering global liquidity arrangements, MoneyGram has been resilient in delivering the best payment settlement service. With the partnership, a seamless user experience has been provided, enhancing MoneyGram’s remittance services. Holmes said:

“For us having access to liquidity and proving speed of transaction and throughput is really what I think can be transformative for our business in the coming decade. Ripple has been doing a lot of unique things with blockchain and crypto to drive that.”

Through its partnership, Ripple and MoneyGram have further explored solutions for improved cross-border payment solutions. Recently, Ripple invested an additional $9.3 million in market development fees for MoneyGram remittance services.

MoneyGram has leveraged Ripple’s On-Demand Liquidity (ODL) payment product, which leverages XRP cryptocurrency to settle cross-border transactions. The company may see a lot of growth in the upcoming years, as more and more consumers revert to digital payments in light of the coronavirus pandemic. Currently, MoneyGram reported that “about 27% of its global business is digital, against the backdrop of 200 countries they operate in.” Only 80 of those 200 countries are reported to be digitized.

MoneyGram Puts Ripple Partnership on Hold Due to SEC Lawsuit

MoneyGram has announced that it will temporarily be suspending the use of XRP and stepping back from its partnership with Ripple Labs, as the blockchain startup’s future remains uncertain due to the SEC complaint directed towards them.

Ripple’s partnership with MoneyGram began in June 2019 and was supposed to extend until July 2023. Ripple had previously paid MoneyGram to leverage XRP for international and cross-border payments, and this has been ongoing since the established pilot agreement between the two companies began in 2018.

Since the agreement, MoneyGram has made $61.5 million in market development fees thanks to Ripple. However, the money transfer giant said on Monday that it “is not planning for any benefit from Ripple market development fees in the first quarter” of 2021, a huge contrast from when MoneyGram generated $12.1 million in market development fees in last year’s Q1.

It further explained:

“Due to the uncertainty concerning their ongoing litigation with the SEC, the Company has suspended trading on Ripple’s platform.”

All payment incentives from Ripple to MoneyGram for using XRP are listed as “market development fees,” which is essentially monetary compensation for providing liquidity to Ripple’s On-Demand Liquidity Network.

In 2018, MoneyGram figured among one of the hugest firms to publicly announce that it was piloting Ripple’s XRP cryptocurrency in its remittance services.

However, the use of XRP by MoneyGram has been temporarily paused given the ongoing legal battle between Ripple Labs and the U.S. Securities and Exchange Commission. The SEC alleges that XRP is an unregistered security, and the complaint therefore places Ripple Labs and its lead executives in violation of federal securities laws.

SEC lawsuit makes XRP unpopular with exchanges

Since the SEC’s lawsuit against Ripple, many cryptocurrency exchanges have also moved to delist or halt XRP trading on their platforms, to avoid legal complications. Even those that have not done so have warned that they may eventually be forced to follow suit, as liquidity on partner exchanges for XRP drops and platforms where XRP can be traded becomes limited.

The move from many crypto platforms to delist XRP has not discouraged the firm, however, as it previously revealed that more than 90% of RippleNet customers were situated outside of the US.

Currently, XRP has managed to break the $0.50 level once again, despite plunging drastically after the SEC announced it was suing Ripple. It has recovered from lows of $0.30 and is now trading at around $0.5370 on CoinMarketCap at the time of writing. What may be keeping its price above water may be the fact that XRP is heavily traded in Asia.

Class-Action Lawsuit Filed against MoneyGram for Allegedly Misleading Investors with XRP

MoneyGram is currently facing a class-action lawsuit for allegedly misleading investors with XRP.

On behalf of investors who bought MoneyGram securities in 2019, Rosen Law Firm has filed a class-action lawsuit against the money transfer company. The law firm alleges that any investors who have bought MoneyGram shares between June 17, 2019, and February 22 of this year is entitled to compensation, seeing as MoneyGram is partnered with Ripple – the fintech firm behind the creation of XRP who is currently being sued by the SEC for offering unregistered securities through XRP.

Per the complaint:

“Defendants made false and/or misleading statements and/or failed to disclose that XRP, the cryptocurrency that MoneyGram was utilizing as part of its Ripple partnership, was viewed as an unregistered and therefore unlawful security by the SEC.”

The complaint filed by Rosen Law Firm further claims that investors suffered damages and that MoneyGram mislead investors about XRP cryptocurrency.

MoneyGram presses pause on XRP

In late February, MoneyGram had announced that it will be taking a step back from its partnership with Ripple by momentarily suspending the use of XRP on its network. The payment giant was previously paid by Ripple to leverage XRP for remittance services. This has resulted in $61.5 million of profit through market development fees for the money sender.  

MoneyGram utilized Ripple’s technology to settle real-time payments in foreign exchanges in a secure manner. XRP was used to convert foreign currencies such as Mexican pesos, Philippine pesos, Australian dollars and Euros, to currencies of another country at a low cost via blockchain.

Throughout MoneyGram and Ripple’s partnership from 2019 to 2020, XRP was utilized on MoneyGram’s network to facilitate money transfers. In 2018, MoneyGram was among the first to pilot the use of XRP on its network for remittance services.

However, with the SEC suing Ripple over XRP, which it considers to be an unregulated and unregistered security, MoneyGram has announced that it will temporarily halt the use of XRP on its platform.

The decision to stop the use of XRP on its network may have come at too late of a time, however, as the money transfer company now faces a class-action lawsuit from angered investors who claim that MoneyGram knowingly misled them.

Ripple and MoneyGram Partnership Ends amid SEC Lawsuit

Ripple and MoneyGram’s partnership through which they furthered remittance services using XRP and Ripple technology has officially ended.

Both firms seem to have ended things on amicable terms, with Ripple suggesting that the partnership may be rekindled in the future. Per Ripple’s official statement:

“Together, Ripple and MoneyGram have made the decision to end our current partnership agreement […] Together, we processed billions of dollars through RippleNet and On-Demand Liquidity (ODL). We are both committed to revisiting our relationship in the future.”

Ripple’s official statement addressing the conclusion of its relationship with MoneyGram comes just as the money transfer giant announced last week that it will not be using XRP for remittance services “in the first quarter of 2021.” MoneyGram’s decision to halt the use of XRP for its cross-border transactions was largely influenced by the lawsuit impediment that Ripple is currently facing for XRP – which the SEC alleges is an unregistered security.

Although short-lived, MoneyGram and Ripple’s partnership has proved to be fruitful for both. Through its partnership with Ripple, MoneyGram has managed to generate $61.5 million in market development fees.

MoneyGram sued by investors over XRP

The decision to end the partnership between MoneyGram and Ripple may be the better choice for both, as the SEC’s clampdown on XRP has opened the door to many class-action lawsuits and legal complaints directed towards any institutions leveraging XRP.

Last week, a class-action lawsuit was filed against MoneyGram by Rosen Law Firm for allegedly misleading investors over XRP.

The suit claims that any MoneyGram shareholders who bought MoneyGram equity during the time period the money transfer company was partnered with Ripple should be entitled to monetary compensation.

Exit mobile version