thecryptobasic.com
MoneyGram CEO discusses Ripple and XRP in cross-border payments, highlighting challenges involved with the use of XRP and the transition to XLM.
In a recent interview with Fortune magazine, MoneyGram CEO Alex Holmes delved into the discussions surrounding Ripple and XRP in cross-border payments, shedding light on the challenges and opportunities presented by these technologies.
Holmes acknowledged that the traditional banking system, designed primarily for domestic payments and corporate transfers, poses a central obstacle for remittance companies.
According to the report, MoneyGram, while exploring various avenues to decrease remittance costs, saw crypto as a potential solution and even integrated a buy-and-sell feature into its mobile app last year.
However, Holmes explained that users’ demand for fiat currency remains dominant as most individuals prefer not to hold cryptocurrencies. The CEO noted that users seek a direct route into traditional currencies once they receive crypto payment.
MoneyGram’s Encounter with XRP
MoneyGram initially ventured into Ripple’s solution but encountered obstacles when converting XRP into local currencies. The process required partnerships with exchanges and market makers, ultimately increasing the costs of international remittances, which the firm sought to reduce.
This challenge highlights the complexities of transitioning from cryptocurrencies to fiat currencies in cross-border payments. Recall that in 2021, the partnership between Ripple and MoneyGram ended not too long after the U.S. SEC filed a suit against Ripple, as captured in a report by The Crypto Basic.
MoneyGram Moves On with XRP’s Rival
Despite these hurdles, MoneyGram has continued its pursuit of innovative solutions. The company is already collaborating with Stellar blockchain (XLM) to facilitate the purchase, storage, and withdrawal of the stablecoin USDC.
This collaboration aims to address the needs of individuals in countries plagued by inflation. By holding USDC in their digital wallets backed by Stellar, people in such regions can transfer it to their local currency when needed.
However, the advantages of holding USDC over traditional U.S. dollars are still under active exploration, with potential fee reductions being a significant consideration.
Ultimately, Holmes’ interview emphasizes the ongoing efforts of remittance companies like MoneyGram to navigate the crypto landscape. While adopting digital assets such as XRP presented challenges, the company actively sought ways to leverage other cryptos to improve cross-border payment efficiency.