On 24th August, the host of CNBC’s Cryptotrader Ran NeuNer conducted an interview with the Senior Vice President, Product Management of Ripple, Asheesh Birla. The discussion revolved around the distinction between Ripple and XRP, the use cases of the XRP token in regards to the products built by Ripple for the banking system, and more.
On the subject of use cases of the XRP token in the products created by Ripple, Birla stated that one of the use cases that the company feels highly passionate about is cross-border payments. Ripple, across the years after its inception, realized that specific cases of cross-border payments had a lot of friction, Birla said. Hence, this pushed the company to build a set of products that would contribute to the ease of process in the area of cross-border remittance.
Birla spoke about xCurrent, the first product built by Ripple that helped the financial institutions around the world to connect and communicate, send compliant information for them to comply with the local regulations and suchlike.
Here, NeuNer asked Birla if xCurrent was just a product that facilitates communication and not transactive features. Birla explained that accommodating communication is the primary purpose of the product, it has also assisted in transferring value. In his words:
“…that’s the main purpose of ex-current but it did help transfer value for fiat currencies. That means non-crypto currencies… And so if you wanted to trade US dollars for Indian rupees, you could do that but it wouldn’t necessarily natively involve a digital asset like XRP.”
Next, the Vice President discussed the second product, xRapid, which was built around solving the problem of liquidity. To explain the use case of xRapid, he cited the example of Mexico as a foreign country, stating that one can move money into Mexico within seconds via the product. It facilitates this service without having a local bank account there or pesos sitting in it. He explained the working of xRapid, saying:
“so the experience is that you send the system US dollars for example… And it converts to XRP, moves the XRP into Mexico and then a local exchange in Mexico would convert that to Mexican pesos and payout. That whole process takes just a matter of seconds versus the days that it takes today, the amount of friction needed to, you know, opening up accounts in new countries, having pesos and so forth. So really excited about X rapid.”
In contrast with the system that xRapid provides, traditional banks use a system called Swift that was created back in the 1960s. Birla spoke about Swift saying that it is just a means of communication between the banks and does not transfer value. Subsequently, he said that an error in such a case takes days to resolve using the Swift system. Birla believes that the product does not solve the intricacy of the modern e-commerce and is archaic.
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