According to an executive at Ripple, the distributed payments service provider has its eye on expanding operations into the Chinese market.
Jeremy Light, Ripple’s vice president of European Union strategic accounts, spoke with CNBC by phone yesterday, during which time he confirmed the company’s interest in expanding into China.
According to Light, Ripple is looking closely at China as part of an ongoing effort to streamline and speed up international payments using its distributed ledger technology (DLT). “China is definitely a country and region of interest,” he said.
In February of this year, Ripple began making inroads into the Chinese market by entering into a partnership with Hong Kong-based LianLian International. The financial services company planned to utilize Ripple’s technology to facilitate faster and cheaper cross-border transactions to its customers in China, the US, and Europe.
Even with its latest partnership, however, Ripple’s entry into the Chinese market is likely to be an uphill climb. China is home to numerous fintech firms and there are several existing payment apps – like Ant Financial’s Alipay and Tencent’s WeChat Pay – that already have a growing and loyal user base among Chinese consumers. To realistically compete, Ripple will have to bring something extra to the table.
What Does This Mean for XRP?
Investors and enthusiasts waiting for XRP to “moon” shouldn’t start planning their retirement just yet. Any expansion into the Chinese market will see Ripple focusing on expanding its financial and institutional client network rather than on advancing the adoption of XRP.
Part of the reason is that Ripple’s flagship solution xCurrent, which is tailored primarily for banks and other financial institutions – you know, the ones who could inject big money into the XRP market – doesn’t actually use XRP at all.
Ripple’s xRapid platform – which does utilize XRP tokens – has garnered interest from money transfer firms like MoneyGram and Western Union, however, both implementations are still in the trial phase.
Ripple’s client portfolio boasts over 100 banks and financial institutions, including big names like Santander, Standard Chartered, UBS, UniCredit, and others.
Another likely reason for not focusing on advancing the adoption of XRP is China’s inhospitable climate where cryptocurrencies are concerned. Last September, the People’s Bank of China (PBoC) issued a ban on ICOs and then doubled down and banned trading on domestic and foreign exchanges. The move caused many China-based exchanges to move to friendlier locations and resulted in a spike in P2P trading as investors sought to circumvent the ban.
If Ripple is able to gain a foothold in China, could it help relax the country’s stance on cryptocurrencies? Let us know what you think in the comments below.
Image courtesy of ShutterStock
