MoneyGram has cut all ties with Ripple labs due to the ongoing legal battle with the US Securities & Exchange Commission.
In December, MoneyGram, a Nasdaq-listed company, had already stopped from using Ripple’s controversial XRP token in forex settlements. This was part of its cross-border payment process. Ripple offered incentives to the Dallas-based money transfer company to use its liquidity service on-demand as part of an agreement that was signed in 2019.
MoneyGram disclosed that it has earned more than $60,000,000 in fees by using XRP transfers to generate additional revenue in settlement and payment services. MoneyGram’s announcement was met by Ripple, who claimed that the suspension was temporary and that their parentship extends far beyond the use its network.
Ripple and MoneyGram made the decision to terminate our current partnership agreement. We are proud of how much work we accomplished in such a short time and the positive impact that we had in bringing this product to market. RippleNet, On-Demand Liquidity and RippleNet together processed billions of dollars,” Ripple stated in a statement.
MoneyGram mentioned in XRP Case
The price of XRP has not reacted to the news, and is still showing 2% gains today, even though the money transfer giant is clearly distancing themselves from the 7th largest cryptocurrency asset by market capitalization.
This decision was taken in light of Ripple’s SEC filing, which claims that XRP is a security. Both companies stated that they were committed to revisiting the relationship in future. However, this is unlikely until Ripple and US regulators resolve their legal rift.
The MoneyGram involvement is already mentioned in the SEC’s complaint. It describes the money transfer company as another “conduit” for Ripple’s unregistered XRP market sales.
The statement continues, “We believe in the promise that digital assets and blockchain technology can change the status quo of global payments for billions of consumers around world,” it states.
MoneyGram used Ripple’s on-demand liquidity product, xRapid to make it possible for blockchain payments to be commercially available. Ripple’s long-term plan to be the preferred crypto payment platform not only on the internet but also through brick and mortar transfer providers, this partnership was a perfect fit. According to the startup, which is based in San Francisco, the blockchain project could be expanded worldwide.