Brad Garlinghouse: Ripple working on “multiple” potential investments and acquisitions. $1bn xRapid volume by the end of 2020.

by | Aug 9, 2019

Brad Garlinghouse, the CEO of Ripple Labs, gave an interview on Friday at Yahoo! Finance.

According the the interview, the MoneyGram deal was only the beginning:

“We’re (Ripple) in a very strong position, our business is growing strongly, we have a strong balance sheet, and I intend to press our advantage”.

He continued to say that active discussions on “multiple” potential investments and acquisitions were currently underway but declined to give further details.

In relation to MoneyGram’s use of XRP and xRapid Brad mentioned that:

“It’ll start to ramp in Q4 but really we’ll start to see more consequential volumes in Q1”.

When suggested that the share price premium was an indication Ripple had to pay Moneygram to use XRP and xRapid technology Brad denied it categorically explaining that more and more customers are signing up and accelerating that rate could be perceived as inducement where essentially its an incentive.

He continued to explain that:

The high deal price came about because private equity firm Thomas H. Lee partners, which owned just over 42% of the company, didn’t want to sell at market values. Moneygram shares had declined almost 80% in the 12 months before the deal, which likely contributed to the reluctance. If we wanted to buy more than a small percentage of the company, it was going to happen above market price.”

When asked to comment on Moneygram’s CEO Alex Holmes statement that the partnership with Ripple will be a “tremendously beneficial relationship for all parties involved he said that:

“To the extent that we can partner with someone to push volume, it’s good for them because they don’t have to pre-fund, it’s real-time, it’s cheaper; it’s good for us because this is early days of what we’re doing. The more liquidity there is, that means the spreads get tighter. The tighter the spreads get, the more efficient that corridor gets. The more efficient that corridor is, the more comes through there. So there’s a flywheel that happens and once you get it moving it starts to feed itself.”

Garlinghouse believes that the MoneyGram-Ripple deal will have a greater impact than the Libra project:

“The Moneygram deal is really one of the first scaled use cases of a digital asset in production. This is a big deal. If I were betting now, a year from now the Moneygram deal will have a more consequential impact on the crypto markets than the Libra white paper [Facebook’s cryptocurrency project].”

He even predicts that by the end of 2020 there will be “over $1bn of xRapid volume”. Brad estimates that Ripple will sign around 100 contracts this year, with 20% likely to involve xRapid and XRP.

“Banks that two years ago told me: Hey we love your technology, we’re thrilled to be working with you but we’re not going to use crypto. I said OK great. Some of those same banks are now coming back and saying hey let’s talk about that because they see the value.