Ripple increases equity stake in MoneyGram International

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Daniel Webber
Daniel Webber
Founder & CEO
Daniel is Founder and CEO of FXcompared and has 18 years of experience in the international finance world focusing on cross-border payments, technology and the property sectors. Daniel is widely… Read more
  • Latest move means Ripple now owns 9.95% of MoneyGram International
  • Cryptocurrency company has invested $50m in the money transfer firm
  • Ripple's coin XRP recently hit record transaction levels beating both Bitcoin and Ethereum

In a further sign of the ongoing integration and consolidation between the traditional financial system and cryptocurrency sectors, Ripple has increased its equity stake in MoneyGram International.

Initially, Ripple invested $30m back in June.

Last week, it announced a second round of investment worth another $20m.

The latest move means that the crypto giant now owns a stake in the successful international money transfer firm worth 9.95% of its total.

Ripple also obtained warrants that mean it could increase its stake to around 15% at some point in the future.

The stock purchase was made at $4.10 per share, well above the current market price for MoneyGram which is around $3.

While some observers say the premium paid shows that Ripple believes MoneyGram is undervalued on the markets, others say that the price reflects Ripple's desire that its XRP digital token will continue to be used in the online money transfer cross border payment operations offered by MoneyGram.

Chairman and CEO of MoneyGram, Alex Holmes, is highly supportive of Ripple's tech: "Our partnership with Ripple is transformative for both the traditional money transfer and digital asset industry - for the first time ever, we're settling currencies in seconds", he explained.

"This initial success encourages us to expedite expanding our use of On-Demand Liquidity", Holmes added.

Brad Garlinghouse, Ripple CEO, said: "Last month, we announced that MoneyGram began using On-Demand Liquidity for payments to the Philippines, and we're excited to support MoneyGram's further expansion into Europe and Australia."

"Digital assets and blockchain technology have the potential to make a tremendous impact on cross-border payments - MoneyGram and Ripple is an example of that", he added.

The On-Demand Liquidity (ODL) solution from Ripple leverages its XRP cryptocurrency to "send money globally, instantly, and reliably for fractions of a penny".

Already 10% of MoneyGram's Mexican peso foreign exchange transaction volume goes through the system and is beginning to be used for other cross-border operations.

XRP transactions recently hit record levels of more than 4m per day, which far outweigh those of established crypto competitors Bitcoin and Ethereum.

You can stay up-to-date with all the latest news in the world of money transfers by keeping an eye out on our magazine news pages.


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