XRP (XRP) has been on a roll for the last few days, flippenning Ethereum at some point in the last 24 hours. This is driven by the increased realization that ripple technologies like XRapid are the future of payments. Its value proposition is simply unrivaled in the financial services industry. That’s because it gives ready liquidity to financial institutions, while at the same time providing near instant settlements, at almost zero fees. This stands to open up new revenue opportunities for banks, especially the smaller ones that in the past, had to rely on the big banks for cross-border payments. But even for the big banks, the massive capital reserves that XRapid will free up could be channeled to other profitable areas in the finance world. In essence, once XRapid goes, the banking industry could enter an era of unprecedented profitability.
However, for other financial services companies whose sole business is cross-border payments, this could be a moment of reckoning. Most of these them have built their business models around fees, even though it may not be in the best interests of consumers. For such companies, many of which are global giants that have been in the business for over a century, this could be the time when they come face-to-face with disruption. That’s because XRapid is bringing in a business model where consumers can enjoy the instant global payments that these companies already offer, but at close to zero fees. This pretty much brings into question the whole point of the existence of these companies going into the future. In such a high stakes business environment, two scenarios are likely to play out.
The first one is that these companies could move with the times and adopt XRapid. By doing this, they can restructure their operations and get leaners, but more efficient. They can then ride their globally entrenched brand names to come up with new innovative products that could propel them to higher levels of profitability in the future.
The second scenario is that some of these corporations, due to bureaucracy and denial, will resist this new revolutionary technology. Such companies are likely to become dinosaurs of the finance industry. That’s because as consumers get used to instant, near feeless transactions, it will impossible for these corporate behemoths to justify their existence in the market. They will simply fizzle out of existence, just like many others in the past. Technology has always ruthlessly killed businesses that fail to move with the times. At one point, Kodak was the dominant player in the photographic film business. Its failure to adopt digital technologies earlier along saw it file for bankruptcy in 2012, bringing to an end a reign of close over 100 years.
However, this disruption that ripple is bringing to the financial services industry will also lead to the emergence of new innovative startups that will take consumers services to the next level. Already, applications that enable people to send money instantly, and close to zero fees are coming up. These will over the years grow in prominence, further entrenching ripple as the backbone behind it all. This will add to the intrinsic value of XRP (XRP), as ripple continues to disrupt how people, send and receive money. Just to contextualize how big ripple is, one just needs to look at how it could impact the global economy. This is a technology that has implications that touch on the entire global economy, from people repatriating money to their families, to importers and exporters moving money faster, which in turns translates to faster business process.
Clearly, the future of XRP (XRP) as an investment is bright. It’s potential to transform the trillion dollar financial services industry is slowly taking shape, making the sky literally the limit for this crypto.