Ripple On-Demand Liquidity now available in Australia through FlashFX partnership
Ripple's more self-explanatory xRapid replacement has made its way down under.
Ripple recently discontinued its separate xCurrent, xRapid and xVia products and replaced them with the more universal and self-explanatory On-Demand Liquidity (ODL) product.
This month, ODL comes to Australia for the first time through the FlashFX international money transfer service, as announced on Appropriately. FlashFX also became the first Australian company to use blockchain for international money transfers when it first got with Ripple some years ago.
"FlashFX has long been at the forefront of leveraging blockchain technology to improve money transfers," noted Ripple's Marcus Treacher. "As one of the first customers to pilot our ODL product and a like-minded mission to improve cross-border payments, they were a natural fit to partner with to open a new corridor."
The new corridor is between Australia and the Philippines, and the functional upside of ODL here is simply faster and cheaper money transfers. The same benefits will be making their way to other FlashFX corridors in time.
"Ripple’s new generation product... in essence allows consumers to experience the power of blockchain as part of an international money transfer service," said FlashFX CEO Nicolas Steiger. The effect is vastly reduced transfer times, and lower transaction costs, he said.
"There is no doubt that Ripple's solution is the key to the future of cross-border payments as it provides on-demand liquidity using a digital asset to reduce the reliance on pre-funding at the destination for FlashFX."
How it works
The "reliance on pre-funding at the destination for FlashFX" that Steiger mentions is the need to ensure that there are enough Philippine pesos at the destination for the recipient to pick up. The need to forecast expected demand for a payment corridor and then lock up funds on the other side is the cost of fast transfers.
The way ODL solves this problem is simply by using XRP as a source of liquidity.
The company illustrates it like so:
The trick is simply that XRP is a fast, cheap-to-transfer and highly-liquid cryptocurrency, which makes transacting through digital asset exchanges faster and cheaper than using "real" money.
"Officially joining RippleNet will allow our customers to experience... increased speed of settlement and zero transaction fees," Steiger said.
Long term and short term
FlashFX is the first company in Australia to use ODL, but others have been with it for a while. The most notable is probably MoneyGram, which sold Ripple a considerable stake earlier this year. Overall, Ripple now has more than 300 customers, it announced today.
But the same old question marks are still hanging over Ripple's head. Firstly, there's the age-old "peer-to-peer versus intermediated transfers" argument. And secondly, there's the question of whether XRP will have a long term purpose in an emerging world of central bank digital currencies, stablecoins and other cryptocurrencies.
Being faster and cheaper than Bitcoin is possibly the single lowest bar in all of blockchain, and XRP's value proposition – being worth something because it's useful and being useful because it's worth something – may have to change as the space evolves.
Long term question marks aside, there's no doubt that Ripple's blockchain can deliver faster and cheaper transactions than banks today. And as it continues rolling out, more people will be able to feel the difference for themselves... assuming they bother.
Disclosure: The author holds BNB, BTC at the time of writing.
- Ethereum price shrugs off SEC and IRS criticism with 24-hour rally
- Can Bitcoin beat the Fed? BTC price increases despite bearish news
- Intel and Block support for miners could push Bitcoin higher
- Cathie Wood’s ARK analysts predict Bitcoin at US$1 million each by 2030
- Gibson prepares to offer NFTs based on its classic guitars