Ripple has announced a partnership with UAE Exchange, one of the world’s largest remittance and foreign exchange companies.
More specifically, UAE Exchange will being using the RippleNet, a platform that uses blockchain to instantaneously send and receive cross-border payments.
UAE Exchange CEO Promoth Manghat explains that “the early adoption of this game-changing technology allows us to offer a competitive service, as it will have an impact on the speed and cost of cross-border transactions.”
It’s important to make the distinction that whether or not UAE Exchange will use XRP tokens in its processes is not yet known. Business Insider reported that firms using the RippleNet for international transfer do not ordinarily use XRP tokens; Ripple uses XRP for the purpose of providing liquidity, but not for sending cross-border remittances.
#UAEExchange partners with @Ripple for instant cross-border payments & becomes the first global #money_transfer business in Middle East to offer real-time, seamless #payment solutions using #blockchain technology. Read more: https://t.co/iXbUycOB6b pic.twitter.com/vC8cagF3s9
— UAE Exchange (@uaeexchange) February 11, 2018
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However, the partnership is still slated to bring a positive change to the forex industry. Global Head of Innovation Infrastructure at Ripple Dilip Rao states that “adding a market leader like UAE Exchange to RippleNet will bring instant, certain, low-cost payments to the millions of retail customers in the UAE who send money abroad.”
Another High-Profile Partner for Ripple, but Skepticism Lingers
With more than 9,000 employees spread across 40 countries and 800 offices located in 31 countries, UAE Exchange is nothing to shake a stick at. Business Insider reports that the company also claims to control 6.75% of the $575 billion global remittance market, a figure that it hopes will increase to 10% in the next two years.
In October of last year, Ripple claimed that more than 100 financial institutions had begun using the RippleNet, although the New York Times reported in early January that Ripple could not name many of the companies because of ‘confidentiality agreements.’
In the months that have followed that announcement, however, there have been at least a few high-profile announcements of partnerships in addition to the UAE Exchange. Amex, Santander, Woori Bank, Shinhan Bank, Standard Chartered, and Rakbank are just a few.
Still, Ripple has come under scrutiny for being overvalued. In early January, BlockTower hedge-fund co-founder Ari Paul told the New York Times that “I’m not aware of banks using or planning to use the XRP token at the scale of tens of billions of dollars necessary to support XRP’s valuation.”
At the time of press, XRP tokens were worth approximately $1.07 apiece, down from their January high of roughly $3.45.