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Gateway Currency: Cross-Border Payment Specialist Compares XRP to USD Dollar

newslogical.com 26 May 2020 02:30, UTC
Reading time: ~2 m

Cross-border payment specialist Faisal Khan has said, that in response to series of questions asked about holding XRP, he can and will never give financial advice on cryptocurrency due to the volatile nature of the market.

However, Khan described XRP as a gateway currency that bridges the gap between two different fiat currencies, comparing the fourth-largest digital asset to the US Dollar.

He said the United States Dollar is an aggregate currency that many countries hold for international transactions, explaining that USD helps bridge the gap between two or more currencies.

“The more liquid a currency is, like the US Dollar, the more cross pairs you can do.”

Speaking further, he mentioned that the one currency in the cryptocurrency industry, that links different cryptos and different fiat currencies is XRP, and that is the exact goal of the digital currency.

He averred that XRP is designed to be a bridge currency that helps people transfer money easily across the border. He said that different currencies that are being used in two countries where transactions take place is a barrier, but XRP helps solves issues like this.

The payment specialist furthered that this is achieved by buying XRP from cryptocurrency exchange with a fiat currency. Meanwhile, banks do not need to pre-fund account and the transaction gets executed in 2 to 3 seconds, Khan noted.

Khan added that as the remittance industry grows, it is unclear if XRP would be the only bridge currencies as there are other cryptocurrencies that can also perform similar activities.

He said the likes of EOS, BNB, Ethereum, Tezos, and IOTA among other cryptocurrencies are also out there to be used as bridge currency as that is one of the basic goals of cryptocurrency as a whole.

Nevertheless, he explained that unlike other cryptocurrencies, the exact mission and vision of XRP is to serve as a bridge currency. This is the real reason why Ripple created XRP.

To enhance the adoption of XRP for cross-border transaction Ripple launched the On-Demand Liquidity product that allows financial institutions to use XRP via Ripple’s blockchain solution.

Khan added that he thinks XRP has the chance of becoming the global gateway currency, as Ripple continues to build the XRP ecosystem to offer customers better experience.

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