MoneyGram Distances Itself from Ripple Following SEC Lawsuit

The remittance company is using Ripple’s ODL for the exchange of four currencies.

As exchanges start to distance themselves from XRP following the US regulator’s lawsuit against Ripple, remittance company MoneyGram issued a statement to clarify its relationship with the blockchain company.

“The Company has not currently been notified or been made aware of any negative impact to its commercial agreement with Ripple but will continue to monitor for any potential impact as developments in the lawsuit evolve,” MoneyGram stated.

The remittance company’s statement came as Ripple is a prominent investor in it. The California-based blockchain company made its investment into MoneyGram at the beginning of 2019 with a promise of $50 million in total investment.

Ripple recently decided to shed 33 percent of its total stake in MoneyGram.

In an exchange for the investments, MoneyGram agreed to use Ripple’s blockchain-based technology in its existing cross-border payments infrastructure for four currencies.

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Not Dependent on Ripple

“MoneyGram has continued to utilize its other traditional FX trading counterparties throughout the term of the agreement with Ripple, and is not dependent on the Ripple platform to accomplish its FX trading needs,” MoneyGram specified.

“As a reminder, MoneyGram does not utilize the ODL platform or RippleNet for direct transfers of consumer funds – digital or otherwise.”

Ripple’s troubles began earlier this week as the US SEC filed a lawsuit against the company for selling unregistered securities and illegally raising $1.3 billion since 2013. Two Ripple executives, Chris Larsen and Brad Garlinghouse were also named in the lawsuit.

Though MoneyGram is not a party in the lawsuit, the SEC specifically mentioned its relationship with Ripple.

“The Money Transmitter became yet another conduit for Ripple’s unregistered XRP sales into the market, with Ripple receiving the added benefit that it could tout its inorganic XRP ‘use’ and trading volume for XRP,” the SEC complaint noted.

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