Ripple

The cryptocurrency Ripple (trading symbol: XRP) has seen its Fundamental Crypto Asset Score (FCAS) climb 2.8% over the past three weeks, driven by a 5.6% spike in our Developer Behavior criterion. Our User Activity measure also jumped 0.1%, but Ripple's Market Maturity measure fell 1.6% and its price tumbled 15% over the same time period.

Let's check XRP out:

A Two-Pronged Approach

Ripple is a growing force across the global financial landscape, establishing inroads to institutional finance while cultivating products in the cryptosphere.

Touted as a currency exchange, a Real-Time Gross Settlement system or ("RTGS") and a remittance network, Ripple creator Ripple Labs Inc. has taken a two-pronged approach to boosting the cryptocurrency's adoption:

  • xCurrent. This product, built on top of RippleNet, is a cross-border payments system that's based on traditional currencies like the U.S. dollar. It's been disrupting well-established solutions such as SWIFT -- the Society for Worldwide Interbank Financial Telecommunication, a messaging network that facilitates international transfers of money and securities between more than 11,000 financial institutions around the globe.
  • xRapid. This product utilizes XRP directly for payment solutions. Users purchase Ripple using traditional currencies on one end of the transaction, then sell the cryptocurrency back for traditional currencies at the other. Ripple Labs has made it possible for xCurrent clients to integrate xRapid, making the platform an ideal on-ramp for traditional customers to adopt digital-asset solutions.

The company also announced a $30 million partnership in June with money-order giant MoneyGram, taking a 10% stake in that company. Following the deal, MoneyGram went live on Aug. 3 with Ripple's xRapid.

The transaction has been touted as a way for MoneyGram to improve settlements on its cross-border payments while giving Ripple an entry into well-established payment channels. Our scores for Ripple's FCAS fundamentals increased in the days leading up to MoneyGram's xRapid launch and have maintained their upward trajectory as development efforts on the platform rise.

Our Hot Take

Ripple Labs' strategy continues to evolve as the team taps into financial arteries in a growing number of corridors across the globe.

The company is offering conservative institutional clients an on-ramp to the Ripple platform through xCurrent, while also evolving xRapid to offer refuge from the complexities of using foreign-exchange markets to settle transfers. That's effectively delivering efficiency and cost savings to established market participants.

While Ripple Labs maintains that it no longer has control over the Ripple cryptocurrency, it still owns a substantial portion of the outstanding tokens. The company is also actively developing and promoting adoption of its xRapid solution, which utilizes Ripple cryptocurrency.

As such, it's likely that the Ripple Labs team will continue striving to "onboard" institutional clients wary of crypto volatility to xCurrent, with a long-term vision of moving these customers to xRapid over time. So, keep an eye out for more high-profile partnerships to emerge from Ripple Labs during the balance of this year.

Here's our overall rating for Ripple:

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