
MoneyGram Signs Deal to Work with Currency Startup Ripple - ggurgone
https://www.wsj.com/articles/moneygram-signs-deal-to-work-with-currency-startup-ripple-1515679285
======
t1o5
There are many remittance companies in UAE, Saudi & Oman where migrant workers
send their salary back home to India, Pakistan, Bangladesh, Nepal &
Philippines. UAE Exchange being the major player there. Many of these
companies might want to signup for Ripple because they can avoid the middlemen
(what if Ripple becomes the middlemen ?) , thus more profits while keeping the
fees low for customers and have rapid money transfer rather than waiting days
for bank clearance.

The problem in implementing this is the origin & destination country should
have legal mechanisms in place to operate this. Many low income migrant
workers use schemes called "Hawala" , "Hundi" to avoid the fees charged by the
remittance companies.

Maybe RippleNet can work in favor for both consumers and providers. Do keep in
mind that RippleNet is not the same as XRP. The remittance houses will have to
maintain Nostro and Vostro accounts for funding which I believe is currently
maintained in USD. They can switch this to XRP to avoid those transaction fees
and overhead.

~~~
jerguismi
> Maybe RippleNet can work in favor for both consumers and providers. Do keep
> in mind that RippleNet is not the same as XRP. The remittance houses will
> have to maintain Nostro and Vostro accounts for funding which I believe is
> currently maintained in USD. They can switch this to XRP to avoid those
> transaction fees and overhead.

For me this doesn't make much sense, why would the remittance operators be
willing to hold XRP now? It is unstable and volatile like Bitcoin.

This whole ripple thing sounds like an epic scam. The actual technology is
just a story that people can tell without actually understanding the business.
Then the actual business is pumping the token, and then dumping at some point.

~~~
justboxing
> why would the remittance operators be willing to hold XRP now?

They don't hold it forever. The sender and receiver hold XRP only for the
period of time that the transaction is confirmed and settled, and according to
Ripple CEO Brad Garlinghouse, this time is as little as 3 seconds.[1]

Source: See
[https://youtu.be/vnGNycbhJlE?t=388](https://youtu.be/vnGNycbhJlE?t=388) at
6:28. He explains this.

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2paisay
More than that MoneyGram is a loss making entity with a negative equity. This
is just an attempt by MoneyGram to pull a Kodak (last ditch attempt to stay
afloat by attaching itself to "cypto" currency bandwagon)

~~~
shafyy
I think "pull a Kodak" is an awesome term. I checked if it was already
published on Urban Dictionary. It wasn't, so I submitted it and it was
published:
[https://www.urbandictionary.com/define.php?term=pull+a+Kodak](https://www.urbandictionary.com/define.php?term=pull+a+Kodak)

I hope that's ok :-) If not, please let me know.

~~~
flycaliguy
Pulling a Kodak for me would be something else. It would be when a company
that boomers love can no longer innovate and just starts licensing it’s image
to the highest bidder. We’ve seen this many times with action cams and so on.

~~~
shafyy
Well, that's not what Urban Dictionary says.

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black_puppydog
This is pretty much exactly Ripple's use case, and remittances are a huge
deal. So, progress! :)

~~~
joeblau
Totally agree! But the one caveat is that using Ripple does not mean using
XRP.

~~~
mkirklions
Can you explain this further?

XRP is the currency to move money at Ripple.

They have some minor currencies for some situations like debt IIRC.

But Ripple is going to use their currency for transactions.

~~~
joeblau
You're understanding is 1/3 correct. XRP is _only_ used for xRapid protocol.
Ripple Labs has 3 protocols (xCurrent, xVia, and xRapid) and the other 2 do
not use XRP. However, it does look like MoneyGram is using xRapid.

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kristofferR
I'm amazed MoneyGram is still in business. I had to deal with them last week
and it was hell.

Their reliance on phone support for most operations is absurd. I saw five
people attempt to use the kiosk - and all were required to call phone support
for various reasons! The kiosk complained about DOB missing (date of birth I
guess?), yet there wasn't any field left unfilled. Changes in unpaid/draft
transactions resulted in duplicate ones instead, and they could only be
deleted by calling support. The kiosk software was filled with dumb errors
like that. I could go on an on.

Using cryptocurrencies seems like a good idea, but I'd bet just improving the
kiosk software to make phone support a rarity instead of practically a
requirement would be way more efficient at reducing cost.

~~~
KeepTalking
The money remittance market is a very interesting problem. The key to
understanding why moneygram is still around is by getting a good understanding
of global banking and associated regulation & fees along with top
immigration/immigration corridors and consumer behaviour in these corridors.

Most money transfers happen from a stable high net worth economies
(USA,UK,Germany, UAE, Saudi Arabia) to growing economies(India, Mexico,
Brazil, Philippines) and following the emmigration/immigration corridor.

The money transfer market is more akin to a marketplace with disparate sender-
receiver situations. Sender banking infrastructure typically is more
sophisticated but disjointed with the receivers banking infrastructure.

Learn more about these patterns in this document.
[https://siteresources.worldbank.org/INTPROSPECTS/Resources/3...](https://siteresources.worldbank.org/INTPROSPECTS/Resources/334934-1199807908806/4549025-1450455807487/Factbookpart1.pdf)

~~~
hrasyid
Can you explain why these situations led them to be secure in business?

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Graham24
many people at work at "investing" in ripple, they all got rather excited when
the value spiked 25% this afternoon.

"This time next year Rodney, we'll be millionaires."

~~~
ben_jones
Same, pretty sure the whole team is buying (small) amounts of bitcoin. Reminds
me of the story of the guy who dodged the great depression because he pulled
his stocks when his taxi driver starting giving him tips.

~~~
TearsInTheRain
That was Joe Kennedy. JFK's father

~~~
joeax
Not only did he pull out of stocks but he was shorting the market.

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zhjansbnas
Amazing that there is supposed to be a $100B of value here and the big
announcement is a pilot program.

~~~
free-trampolin
Not a single price of the top 100 crypto-currencies is reflecting their value.
They are all over-priced by magnitudes and still "investors" insist it is not
a bubble.

~~~
erikpukinskis
If you sum the top 100, what do their “market caps” add up to?

Edit: back of the envelope it’s something like $700 billion.

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rrggrr
I've not used MoneyGram in many years, but as I recall the friction is account
set-up, authentication and funding the transation --> authentication and
account set-up to receive funds. I don't think Ripple removes those choke
points.

~~~
free-trampolin
Ripple is not necessarily targeted at end consumers. In some cases you may
notice lower fees and faster transactions, however, they are targeting banks
and payment providers.

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black_puppydog
Non-paywalled article: [https://techcrunch.com/2018/01/11/ripple-announces-an-
actual...](https://techcrunch.com/2018/01/11/ripple-announces-an-actual-
customer-for-xrp-brackets-ok-its-a-trial/)

~~~
andrewla
And the underlying press release is here: [https://www.prnewswire.com/news-
releases/ripple-and-moneygra...](https://www.prnewswire.com/news-
releases/ripple-and-moneygram-partner-to-modernize-payments-300581372.html)

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linsomniac
Update: They have only decided to do some prototyping, not a full on
deployment. [https://themerkle.com/moneygram-confirms-xrp-integration-
is-...](https://themerkle.com/moneygram-confirms-xrp-integration-is-an-
internal-pilot-program/)

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elango
Are there any other blockchain use cases at scale more than that of RippleNet?

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kazecrypto
Personally, I hope OMG will become the go to for remittance in the crypto
world. Much prefer something decentralized and community focused.

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kumarski
Same question: Are they using XRP?

Answer: No.

Brad Garlinghouse reminds me so much of Dick Costolo. He'll keep allowing
Ripple Deals(bots) to increase the valuation of the company unwarranted.

The banks and no-one I've talked to in fintech has indicated to me any serious
adoption of XRP.

~~~
free-trampolin
Wrong. They use Ripple's xRapid which utilizes XRP. This is (after cuallix)
the second company that uses XRP for money transfer.

~~~
mkirklions
Thanks for posting this, this is my understanding.

Ripple is the company that controls 61% of the worlds XRP. XRP is the medium
to move money.

While I personally dont like centralized currency, this is how ripple works.
Ripple basically decides the price of their own currency since they have sooo
much supply.

~~~
free-trampolin
Unlike other fraudelend coin startups, Ripple made its self subject to
regulations. They cannot simply put all their XRP onto the open market. The
55bn locked in escrow are meant to be sold to institutions partnering Ripple,
as other comments have already stated. Regulations aren't a bad thing. They
are mandatory and prevent us from being scammed in many cases.

The only thing you can blame Ripple for is the insane amount of ripples their
founders are holding.

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aviv
Ripple will be the last cryptocurrency standing when all the dust settles
simply due to it being the favorite of the global banking cartel.

~~~
hanniabu
As far as I'm aware, there is not use of XRP as of now. There's a difference
between Ripple the company and Ripple the centralized blockchain, which many
fail to realize.

~~~
shepardrtc
From a Fortune article about this [1]:

> The partnership will see MoneyGram pilot the use of XRP through a new Ripple
> service, called xRapid

So there is usage of XRP.

[1] [http://fortune.com/2018/01/11/ripple-moneygram-xrp-
cryptocur...](http://fortune.com/2018/01/11/ripple-moneygram-xrp-
cryptocurrency-bank-transfers/)

~~~
alextheparrot
Note the use of the future tense in your quote, while who you were responding
to spoke to the present.

