MediShares (MDS)

On Thursday this week, Ripple (XRP) saw its price move above the $0.5 mark for the first time in the week after the announcement of a partnership with Santander, one of the biggest banks in Europe. This continues to strengthen the stance of Ripple in realizing its goal to make the Internet of Value (IOV) a reality.

Reading through Ripple’s protocol consensus algorithm, which is technically the white paper, XRP is not termed as a cryptocurrency but as a digital asset. This was affirmed by the CEO, Brad Garlinghouse during an interview in the Yahoo Finance All Markets Summit.

“I don’t call this cryptocurrency. It’s not currency. I can’t go to Starbucks or Amazon and use—and you know, somebody inevitably will be like, ‘Well, I have one example where I bought something with a bitcoin.’ And then I usually say, ‘Well, did you do a second transaction?’ It’s not actually a currency.” He said.

Blockchains today perform a role similar to the internet a couple of decades ago. When the internet was first created, information was able to move seamlessly, free and fast to anyone with a connection. Blockchain technology has the same effect but allows the transfer of value to anyone and everyone with an internet connection. Anything of value can well be transferred through the blockchain, now referred to as Web 2.0. In the Ripple consensual paper they refer to this as the ‘Internet of Value’ (IOV).

“One Pay FX uses blockchain-based technology to provide a fast, simple and secure way to transfer money internationally — offering value, transparency, and the trust and service customers expect from a bank like Santander. Transfers to Europe can be made on the same day and we are aiming to deliver instant transfers across several markets by the summer.”

– Ana Botín, executive chairman of Banco Santander.

The Internet of Value                                                     

The major vision for XRP is to create a system that value is exchanged as fast as information is exchanged through the internet. Value is defined as any instrument that adds value to you whether its currency, land titles, royalties, applications, votes, music and movies etc. Currently, a normal transaction between two states takes between 3-5 days to be transferred from one bank to the other. Imagine waiting for 3-5 days before information reaches to your doorstep, it would be a disaster.

In the world today, the poorest are the most affected by the inability to transact between two countries. First, most of these people lack a bank account. Second, the transaction fees make it virtually impossible to transact between different countries with ease. Charges for an Airbnb in Dar-es-salaam may start from $30 while charges to transfer this amount back to Tanzanian shillings may cost up to 60%. Remember, the amount will take close to a week before the Tanzanian finally holds it.

How can we make the transfer of this amounts instant and cheap to all? Is there technology to make transfer of money as easily as sending a text to your friend anywhere in the world ? Actually, there is a way to do it. The Interledger Protocol (ILP).

The Interledger Protocol (ILP)

The ILP is an open source code that allows instant settlement of ledgers by interconnecting financial institutions and blockchains on one system. The ILP is similar to the internet’s HTTP protocol or the World Wide Web that used for online information exchange. It was introduced to the field by Ripple (XRP) in conjunction with other financial institutions such as JP Morgan and payment providers such as MoneyGram.

This standard allows a worldwide connection of all currencies, whether the old fiat currencies or new cryptocurrencies. Most payment system currently rely on bank to bank accounts or through Paypal, Skrill which acts as an intermediary. However, it is still very expensive to transfer a digital asset such as XRP to a bank using USD so as to send it to a Chinese bank using Yuan. The ILP allows for peer-to-peer transactions of whatever currency you wish easily and without additional costs.

A list of developing countries, at the forefront Kenya and Pakistan, have adopted mobile wallets that allow easier transfer of money between the bank and the seller. M-Pesa, the most popular mobile wallet in the world, is used in most developing nations enabling seamless and instant transfers.

Ripple partners with Santander Bank

Ripple (XRP) has spearheaded the revolution of Internet of Value completely. The company released the xCurrent, xVia and xRapid platforms to make the dream of IOV possible. So far multiple financial companies and payment systems have partnered with Ripple to make the transfer of money across country borders ̶ instant and fast as information is exchanged on the net. After JP Morgan, MoneyGram and Western Union, Santander Bank becomes the financial entity to come on board.

Santander One Pay FX is a mobile application available to UK retail customers that allows the users to make cross-border payments to Euro zone and US in EUR and USD respectively. The system will use the xCurrent platform provided by the Ripple Company. The transactions are also enabled for Brazil, Poland and Spain.

This will see the customers of Santander bank receive their payments in less than a day as opposed to the 3-5 day waiting period. The best part of this deal is the mobile application which allows you to send and receive payments at any time anywhere in the UK. The program will be released to other countries soon.

Watch out for Ripple (XRP) guys!

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