The XRP token, which has been developed by San Francisco-based fintech firm Ripple Labs, Inc., has surged nearly 13% in the past 24 hours. XRP is trading at $0.3600 at press time, according to data from CryptoCompare.
XRP 24-Hour Price Chart via CryptoCompare
The token’s significant price increase comes shortly after the Ripple company recently revealed (on September 19th) that RippleNet, a decentralized global network of financial institutions and payment providers, is “now active in over 40 countries across 6 continents.”
RippleNet Expansion, xRapid
According to Ripple, “new [RippleNet-based] payment corridors have opened up in North America, Asia, Africa, Europe, South America.” However, Tim Enneking, managing director at Crypto Asset Management, a firm that uses a proprietary due diligence process to assess blockchain projects, said the market’s reaction to these developments (or announcements) are “exaggerated.”
Despite Sagar Sarbhai, the Ripple APAC and Middle East regulatory head, stating (on September 17th) that xRapid, which aims to minimize liquidity costs for cross-border transactions, will be “launched soon”, his positive announcement was heavily criticized by crypto industry professionals.
Eric Ervin, the CEO of Blockforce Capital, a US-based fintech firm specializing in blockchain-related investments, said:
We do not believe that anything other than rumors and anticipation are driving XRP prices higher today. We expect the market to correct in the short-term, potentially with room for growth if xRapid launches successfully next month.
The Ripple company announced (on September 19th) that it had partnered with the PNC Financial Services Group, one of the largest banks in the US. PNC bank, which reportedly has over 8 million customers and a market capitalization of $380.7 billion, will use Ripple’s financial products to create “an immediate impact on … enabling PNC’s commercial clients to receive payments from overseas banks in real time.”
Highly Speculative, Risky
Other financial institutions that have recently decided to use Ripple’s products (by joining RippleNet) include Saudi Arabia’s National Commercial Bank (NCB). Ripple company’s official blog post noted that after running (successful) tests with the kingdom’s financial regulator, the Saudi Arabian Monetary Authority, NCB joined RippleNet.
Although these developments appear to be promising, the cryptocurrency market remains highly speculative and risky and is dominated by short-term traders. Moreover, the effectiveness of Ripple’s products has been questioned by giant money transfer service provider, Western Union.
Notably, Western Union’s recent crypto-related patent did not mention Ripple or anything related to the startup’s suite of financial products. This, after having tested Ripple’s products for their effectiveness in expediting cross-border transactions.