- Ripple CEO Brad Garlinghouse has announced that Ripple intends to acquire more than $2 trillion in liquidity in the current financial system over the next few years.
- The On-Demand Liquidity (ODL) software solution is perfectly suited for this purpose, as it is clearly superior to the traditional remittance system in terms of speed, scalability and fees.
In an interview with Jay Kim, Brad Garlinghouse describes that the old banking system is no longer up to date and that it is therefore time to supplement it with new technologies such as Ripple’s ODL and replace it completely at some point. The CEO says that $10 trillion is being pre-financed into accounts around the world to help maintain the cycle:
There’s $10 trillion pre-funded in accounts around the world, which is effectively the oil that is facilitating the engine that is correspondent banking. The oil has to be there or correspondent banking won’t work.
Now, if we can reduce the amount of oil, that improves the efficiency of the global economy. So we feel like, bit by bit, we’re going to be able to take that $10 trillion down to $9 trillion, to $8 trillion. This is a journey that will take many years. But we’re incredibly enthused by the progress we’ve made in a relatively short amount of time.
ODL provides instant liquidity and can process transactions in real time to any location in the world at low fees across borders. Formerly known as xRapid, ODL uses Ripple’s native token, XRP, as a bridge currency. This enables fast execution of transfers and conversion of the corresponding XRP equivalent back into the country’s Fiat currency.
Ripple intends to expand its existing payment corridors and volume in order to further advance the adaptation of XRP. The development of Thailand, Brazil and Australia is scheduled for the end of this year and the first quarter of next year respectively. Ripple acquired 10% of MoneyGram’s shares two days ago in order to further expand the collaboration.
Kevin Mole: ODL is a game changer for banks
Kevin Mole, Vice President of Product Marketing at Ripple, states that banks are already using RippleNet to deliver compelling results and are solving many of the problems faced by global payment service providers. Bilateral payment experience in emerging markets, however, is a prerequisite for ensuring a smooth transaction process.
Companies must have prefinanced accounts in the respective target currencies in order for the transaction to take place. This is a costly undertaking that requires enormous resources. ODL eliminates the need for pre-financing by bridging two currencies with the Digital Asset XRP.
This ensures that payments on both sides of a transaction can be immediately sent and received in the local currency. MoneyGram is enthusiastic about Ripple and reports that ODL guarantees reliability, speed, convenience and lower costs than competing systems. Chief Global Operations Officer at MoneyGram International, Kamila Chytil, says ODL is an asset to the company:
We’ve leveraged On-Demand Liquidity on RippleNet to dramatically reduce our operational costs and process global payments at unprecedented speeds.
MoneyGram announced at the Swell Conference that 4 additional payment corridors will be developed and that the volume handled via ODL will be successively increased. Most recently, RippleNet partner TransferGo announced that the company also intends to migrate to ODL to accelerate its own payments.
XRP’s price has risen (+3.43%) to USD 0.2268 in the last 24 hours.