Ripple Swell conference logo

This week played host to Ripple’s Swell conference in San Francisco. The event arrived just as ripple’s price shot up more than 100% and briefly overtook ethereum as the number two cryptocurrency. But what did we learn from the conference? Let’s take a look.

1. xRapid Is (Finally) Live

On the first day of the event, CEO Brad Garlinghouse revealed that three companies are now officially using xRapid to process payments.

The three companies involved are Catalyst Corporate Credit Union (a financial firm), MercuryFX, and Cuallix (money transfer services).

xRapid is Ripple’s flagship product for moving money instantly across borders. The crucial thing is that the software actively uses Ripple’s XRP token to make the transaction (learn more about xRapid here).

diagram of xRapid and RippleNet

Although xRapid has been “piloted” by various financial institutions, this is the first real deployment of the technology. Garlinghouse has previously said that “dozens” of banks will use xRapid (and the XRP token) by the end of 2019.

According to MercuryFX, the system helped slash transaction times between Mexico and the UK from days to just minutes.

2. Bill Clinton Can Talk for a Long Time Without Mentioning Blockchain

Bill Clinton was the big-name speaker at Ripple Swell, but he seemed to spend most of his time avoiding cryptocurrency.

According to CoinDesk, he touched on migration, weapons, and the conflict in Israel, but made only a handful of references to blockchain. When he did talk about the technology, he was vague:

“This whole blockchain deal has the potential it does only because it is applicable across national borders [and] income groups. The permutations and possibilities are staggeringly great.”

Clinton did, however, warn about the dangers of heavy-handed regulation which threatened to stifle creativity in the industry.

Ripple Swell Bill Clinton

3. Ripple Is “Very Clearly Decentralized,” According to Its CEO

Ever since it was created, Ripple has been plagued with accusations of centralization. Unlike bitcoin and ethereum, where tokens are mined by its users, XRP was simply created all at once and gifted to Ripple. Ripple holds most of the XRP in existence and slowly distributes it via an escrow system.

Fighting back against the critics, Ripple’s CEO Brad Garlinghouse said:

“It is very clearly decentralized. I, as CEO of the company, can’t control the XRP ledger. I can’t change a transaction… Anybody can participate in the XRP ecosystem, and if Ripple does something that is not in the best interest of the ecosystem, the rest of the ecosystem can ignore us.”

It echoes previous comments by Ripple’s CTO who said XRP is more decentralized than bitcoin and ethereum. He argued that bitcoin and ethereum are dominated by just three-four mining pools, making it more centralized than XRP.

4. The Price of Xrp Dropped 13% During the Event

Coming off the back of 100% weekly rally, the price of XRP stalled despite the xRapid announcement.

It’s a clear case of “buy the rumor, sell the news” – an old stock market saying. The 100% surge took place as Ripple teased the adoption of xRapid in the preceding weeks. When it was finally announced at the conference, the price dipped.

Is this an indication of disappointment among XRP traders? Perhaps. Maybe they expected a higher profile partnership. However, it’s more likely a natural correction after a 100% rise.

5. Ripple Still Has a Long Way to Go

Although three companies are now using xRapid, Ripple has a mountain to climb. One of the panels at the conference was aptly named the “800-pound gorilla,” referring to the difficulty of convincing banks to adopt cryptocurrency.

Risk-management teams at banks are still reluctant to open their arms to XRP and other crypto assets. They’ll first need to see stronger regulations. The good news is that Ripple says that talks with regulators have been encouraging.

So, what did we learn from the Ripple Swell conference? Ripple is making baby-steps with xRapid, but there’s a way to go before the bigger banks come on board.

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  • xRapid makes cross-border money transfers in minutes (and up to 70% cheaper than current systems).
  • xRapid is now live and used commercially by at least three financial companies.
  • xRapid uses Ripple’s cryptocurrency XRP to settle payments.

Updated on October 4th, 2018 to include new xRapid developments.

Ripple’s astonishing price rise was driven by its partnerships with banks like Santander, American Express, and Western Union. However, most people misunderstood one thing:

The banks weren’t actually using the cryptocurrency XRP yet.

That’s set to change with the introduction of xRapid. Announced at the Ripple Swell event in October,  three financial services are now officially using xRapid to settle international payments.

xrapid - how it works

One of those services, MercuryFX, says xRapid improved transfer speeds from the UK to Mexico from days to just two minutes.

Other banks have reported 40%-70% savings when piloting the xRapid service.

But what is xRapid and how does it use cryptocurrency? First, let’s clear up a few terms.

The Difference Between Ripple and XRP

Ripple is a company that aims to speed up cross-border payments. Ripple has partnered with over 100 banks and boasts a range of money transfer services using blockchain and cryptocurrency.

XRP is the cryptocurrency created by Ripple. It is not currently used by most banks, but it’s a big part of their future plans and the xRapid service.

The Current State of Ripple’s Bank Partnerships

Most of Ripple’s 120+ bank partners are using a Ripple service called xCurrent. It uses blockchain technology to help banks make faster payments and communicate better.

A list of Ripple bank partnerships and logos

But it does not use XRP to settle transactions.

Ripple intends to use xCurrent as a way to onboard its banking partners before convincing them to upgrade to xRapid.

What Is xRapid?

xRapid aims to make those transactions even faster and cheaper. Most importantly, it does use XRP to settle the money transfer.

XPR is used as a “bridge currency” in the process.

Here’s how it works…

Let’s say Bob lives in the UK and wants to send £1,000 to Alice in India.

Using xRapid, Bob’s bank instantly transfers the £1,000 into XRP, via a cryptocurrency exchange.

The XRP is then instantly converted into Indian rupees via a partner exchange in India.

The fees are almost zero and the whole process takes a matter of seconds.

Had Bob used the traditional bank system, it would take days and cost him a large fee.

diagram of xRapid and RippleNet

xRapid: An End to Nostro Accounts

The description above is a very quick outline of how xRapid works, but there’s a reason why it’s so powerful:

Banks need liquidity (i.e. lots of available money) to make a foreign exchange. And the current way they source liquidity is wildly inefficient.

Let’s go back to Bob and Alice. To send money to India using the traditional system, Bob’s UK bank needs a “nostro account” in India. The nostro account is pre-funded with millions in local currency. (This is the liquidity).

Banks have pre-funded nostro accounts like this in every country with a different currency to facilitate cross-border transfers. It’s expensive and incredibly inefficient.

By switching the local nostro accounts for a digital cryptocurrency, there’s no need for bank accounts full of foreign currency all over the world. It’s faster, cheaper and more efficient.

Got It. But Are Banks Using xRapid?

Three financial companies are currently using xRapid on a commercial scale. They are Catalyst Corporate Credit Union (a financial firm), Cuallix, and MercuryFX (money transfer services).

The vast majority of Ripple’s other bank partners, like Santander, are using xCurrent, but Ripple is trying to nudge them towards xRapid. Some banks have begun testing the xRapid product and reported 40-70% savings.

Ripple CEO Brad Garlinghouse said that “dozens of banks” will be using xRapid by the end of 2019.

But it’s a big task. As Ripple’s Sagar Sarbhai explained, “a couple of years ago the narrative was: blockchain good, crypto bad.” Banks were open to blockchain technology, but wary of using cryptocurrency to settle payments.

Sarbhai says that’s beginning to change.

“I think that narrative thankfully is now changing because policymakers, regulators are seeing that there is a strong benefit that digital assets, cryptocurrencies bring in.”

xRapid Now Commercially Available

This is the moment that most XRP holders have been waiting for. xRapid is considered Ripple’s silver bullet because it actively uses the XRP token to settle payments.

If more banks adopt xRapid, the volume (and price) of XRP is expected to increase dramatically.

Why? Because banks and (especially) cryptocurrency exchanges will have to hold large sums of XRP in order to make the transfer. The transfer itself will only require XRP for a matter of seconds, but the services still need a pool of cryptocurrency to execute the trade, thus driving up demand.

Let’s look at this way. If xRapid replaced just 1% of the current international bank transfers through SWIFT, the daily volume of XRP would increase 250x.

Ripple is Quietly Building Exchange Partners

To make these instant XRP trades, Ripple is busy partnering with as many crypto exchanges as possible.

For example, the company has partnered with Bittrex to facilitate transfers between US dollars. They’ve partnered with Bitso for exchanges in Mexican pesos and Coins.ph for Philippine pesos.

So don’t be surprised if the banking partners are slow to adopt xRapid. The exchange partners must come first.

Update: Ripple Merges xRapid into One Service, RippleNet

Since we first published this article, Ripple appears to have removed any mention of xRapid and xCurrent on its website.

Instead, it is now just one product: RippleNet.

It looks like Ripple is bundling its services together in one simple package. This will make it much easier to convince banks to ultimately shift to XRP transfers.

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Image courtesy of Carty Sewill, http://cartyisme.com/.

Cold storage through a hardware wallet such as the Ledger Nano S is among the safest, most secure, and widely recommended way to store crypto assets. However, using a hardware wallet isn’t always straightforward: not all coins are supported, user interfaces are clunky, and users are often required to use multiple apps to interact with different blockchains.

Ledger, the company behind the best-selling Ledger Nano S hardware wallet, seeks to rectify those user experience issues with new desktop and mobile applications that unify all supported cryptocurrency tokens under one central app and dashboard. Ledger first announced the new applications, which will take the place of the existing Google Chrome apps provided by Ledger, back in February of this year.

In a Twitter post, Ledger has revealed that the “initial version” of the Ledger Wallet desktop native application will be available starting on July 9th. Ledger says that even though there is an added wait to their original launch estimate, the wait will be “worth it.” The firm says regular periodic updates will follow after launch – the first of which should be adding ERC20 support.

The mobile version of the Ledger Wallet application is still on track for an “end of Q4 2018” release.

The new Ledger Wallet app is a web-based solution (the current Ledger Manager app is Google Chrome browser-based) that will support 28 different cryptocurrency tokens, multiple ledger devices, and come with a central dashboard to manage all aspects of a user’s digital currency portfolio, including sending and receiving crypto tokens, as well as viewing account balances and transaction histories.

In future updates, Ledger expects to eventually support over 100+ cryptocurrencies, enable integration of third-party apps, and more.

Ledger is a Paris, France-based company founded in 2014 with the goal of “securing the new disruptive class of crypto assets.”