Western Union is testing Ripple, but no current plans to use crypto
Despite a new mention of Ripple testing there has been no change in Western Union's previous position.
Western Union's cryptocurrency ventures began in 2016 with a $50 million investment in the Digital Currency Group (DCG), whose subsidiaries include CoinDesk, and whose holdings include Ripple and much, much more.
This is most likely its current avenue of Ripple testing. Western Union has previously described itself as aiming to stay on the "inside track" of blockchain and cryptocurrency development, but still not looking to adopt cryptocurrency payment systems in the near future. And despite a recent new mention of Ripple, it doesn't look like Western Union's position has changed.
In a February 13 earnings call, Western Union CEO Hikmet Ersek gave a bit more clarity into how exactly Western Union is testing Ripple, where it sees itself in relation to cryptocurrency and what's needed before there's a chance of wider adoption.
Part of this was a clarification that Western Union was still simply testing Ripple, in line with its goal of examining the potential of blockchain technology.
"Well, first of all, we will have to differentiate between cryptocurrency and blockchain obviously, right... blockchain is definitely something interesting as an application which we may use in several parts. And we do with Ripple do some tests with some corridors on the settlement side. Is it dollar to pesos or on that side? Can we use that on a real-time blockchain environment? And so this is a test that we are using on that."
Ongoing issues included the use of cryptocurrencies as actual currencies, and challenges around accounting for their lack of officially sanctioned value, and tentative use cases.
"...if digital currencies are ordinary currency, which is used by a country then we could do it but it's hard to do a carwash with a Bitcoin or go buy milk or pay school fees with a Bitcoin in Bangladesh or in Ghana or in Chile. So I think that's the environment."
The uncertain regulatory environment around cryptocurrency also remains a concern.
"Then other thing is also, look we are a regulated environment. That is one of our strongest asset that we are regulated in 200 countries and we respond to the regulated environment. We do have the compliance programs for 40,000 corridors. And within that environment, with the Reserve Bank together, we apply our regulatory operations to the regulatory environments. So it's important for us that this currency should be regulated, and so we can really serve the customers in the right way."
Despite the mention of Ripple's name, there's been no change in Western Union's previous position. Obviously Western Union is testing blockchain technology, and naturally Ripple would be among the systems it's testing.
Western Union has previously made its position clear and it doesn't look like anything's changed, as Ersek said.
"...so far, it's not something to report that we're going to change the environment. Our existing capability is very stable, as you can see from our performance, but that's something that we're taking seriously and looking at it and testing."
- SEC crackdown on Binance, Kraken – What it means for Aussie investors
- Sam Bankman-Fried found guilty – what it means for Australian FTX victims
- Bitcoin’s price soars over 10% on ETF rumours – here’s why
- New regulations for Aussie crypto exchanges: What it means for investors
- Sam Bankman-Fried’s FTX trial starts tomorrow – what it means for FTX customers
Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VEN, XLM, NANO, SALT