Are banks using the Ripple platform?

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By 2020, more than a third of the world’s largest banking institutions were using Ripple’s technology. Over 250 financial institutions, including MoneyGram, in over 50 countries have adopted its cross-border payment technology. As a result, Ripple is the fifth cryptocurrency by market capitalization.

According to many crypto experts and analysts, it is the perfect time to invest in Ripple. Currently, it is quite cheap. But, Ripple’s value will rise, even crossing Litecoin’s and Cardano’s value. Thus, many investors and traders are not sure if banks use Ripple in 2021. So, let us find out.

How do banks use Ripple?

Ripple serves as both a currency and a platform. Ripple Labs is the company credited with creating the Ripple Consensus Ledger. It also owns a majority of Ripple stock. Its expert developers use an open-source protocol. This enables users to conduct fast, cheap, and secure cross-border transactions.

Bitcoin serves as a store of value. Alternatively, Ripple seeks to bridge the gap between traditional banking systems and blockchain. The company offers financial institutions with reliable payment solutions through its RippleNet platform.

What is RippleNet?

RippleNet refers to a network of financial institutions that use Ripple technology. Such technology assists in allowing seamless international financial transactions. Since its launch, Ripple has secured a vast network of financial industry professionals and institutions. 

These institutions have exclusive access to its advanced blockchain system. The platform allows users to connect to its vast network through a single API. In turn, users can move money around in a more secure, faster, and cheaper ecosystem. Some of Ripple’s partnering financial institutions include Bank of America, Standard Chartered Bank, Barclays, and SBI Holdings. 

What products does Ripple offer banks?

Currently, there are two main products that Ripple offers its users. They are xCurrent and xRapid. xCurrent is the first project developed by Ripple Labs for its market. It is an international real-time gross-settlement solution. It enables users to complete their transactions in record time. 

Traditional money transfer systems, like SWIFT, take two to five days to complete a transaction. xCurrent technology allows users to clear and settle transactions within minutes. Furthermore, the network maintains instant communication with the user through RippleNet messaging services. 

xRapid seeks to eliminate the need of holding accounts as plenty of money sits dormant in them. Instead, it sources liquidity from the local market. The system buys XRP for fiat currency on one end of payment and sells that token for fiat on the other end. 

If a bank wants to send a large sum of money to another bank in the network, xRapid buys XRP with the sender’s money. It will sell the XRP tokens for fiat currency to complete the transaction on the side of the buyer. As a result, it provides further savings on transactions and instant funds transfer. It also opens the market up for new business opportunities.

xRapid is a revolutionary system. It allows financial institutions not to hold cryptocurrencies for a long time. The exchange from XRP to fiat and back occurs in seconds. This is because the XRP ledger system can handle 1500 transactions per second. 

Another less common Ripple product is xVia, a standard API solution. It allows various businesses to send money easily from emerging markets through RippleNet. Thus, corporates, digital wallets, and payment providers can use it to enable fast, secure, and cheap transactions anywhere in the world.

What does the ongoing lawsuit mean for Ripple’s partnerships?

At the end of 2020, the U.S Securities and Exchange Commission filed a complaint against Ripple. It accused Ripple of raising billions of dollars by selling digital tokens, XRP, to traders. As a result, the commission claims that Ripple has violated federal securities laws.

Although Ripple has many partnerships with key financial players, many of them had several reservations about Ripple/XRP. Like ATB Financial, most banks viewed that the platform lacked the notion of trust. At the time, there were too many unknowns. Yet, with time, Ripple’s advanced technology won them over, forming alliances with them. 

Luckily, the complaint launched by SEC steers clear of the money it made through selling its software. Instead, it is questioning the amount made through the sale of XRP. For instance, Ripple earned approximately$23 million by selling its xVia and xCurrent software. Alternatively, it made $200 million through its sale of XRP to its investors.

In other words, this means that Ripple gained the majority of its revenue from selling XRP. This revenue, in turn, funded its diverse operations. Thus, this complaint, which was officially filed in court earlier this year, could affect the operation of this cryptocurrency. Ripple’s value already experienced a sharp 14% drop during the launch of the complaint. But, it rebounded slightly when Ripple filed its defense. 

Despite the ongoing lawsuit, Ripple continues to maintain its high rank in the crypto community. Its partnering banks and financial institutions continue to use RippleNet and its software. However, there are no new partnerships in discussion, which is somewhat worrisome. 

There are also several cryptocurrency exchanges that delisted XRP owing to the lawsuit. This, in turn, affected the token’s market value. They include Coinbase, Bittrex, Bitstamp, Ziglue, and, among many others. 


Despite SEC issues, banks use Ripple, and several exchanges still support XRP trading. So, if you are looking for a good investment opportunity in 2021, Ripple is still an ideal option. As a matter of fact, now is the best opportunity to invest in it since its prices are low. Over time, Ripple’s value will continue rising, eventually hitting the $1 mark by the end of 2021. 

Similarly, Ripple continues to gain rising acceptance in the financial industry. In the future, Ripple and XRP aim to establish a global presence in conventional capital markets. Also, more banks and financial institutions continue to interest in RippleNet’s membership. As a result, its market value is only going to continue rising.

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