Between MoneyGram and Ripple, the blockchain startup issuing cryptocurrency XRP, difficult to talk about a traditional customer-supplier relationship. Close financial ties unite the two players in finance.
And it is thus the supplier who pays large amounts to his client for the latter to use his solutions. MoneyGram committed in 2018 to use XRP through xRapid (now ODL) from Ripple for part of its activity, but in return for a $ 50 million investment.
However, Ripple since then continues to pay money to the user of its platform, notes the Financial times. Blockchain company pays MoneyGram according to a document sent to the US SEC.
So in the space of two quarters, Ripple paid his partner the equivalent of $ 11.3 million, in the form of XRP however. Its value therefore fluctuates according to variations in the price of the cryptocurrency.
This amount was recorded as income by MoneyGram, which due to SEC instructions had to account for it afterwards as "against expenditure." Officially, Ripple pays the money transfer specialist "market development fees."
For the financial newspaper, it could thus be a subsidy granted by Ripple to compensate for the shortfall in the use of his system. MoneyGram declined to comment on this information, however.
Ripple so far remains discreet about its results. In August 2019, its CEO Brad Garlinghouse claimed that more than 300 financial institutions were exploiting its technology. The leader recognizes that some may benefit from incentive, depending on the importance of that user.
However, these subsidies do not slow down the profitability of Ripple ? When questioned, the CEO assured that the company had a positive cash flow, without specifying whether this result was primarily enabled by the services or the sale of XRP.
We would not be profitable or have a positive cash flow [sans la vente de XRP], ”Said Garlinghouse, however.
In December, during a Series C funding round led by Tetragon, Ripple raised $ 200 million.
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