Ripple is actually being used over 100 companies all over the world, some of which are using it for pilot testing and some of them have already adopted it.
Their tokens are meant to be like a vehicle for online money transportation through the RippleNet which connects banks, payment providers, digital asset exchanges and corporates.
What it really does?
Let’s say that Bank A located in South Arabia wants to send money to Bank B located in America, Bank A needs to convert its local currency to USD, losing 1–3% with exchange fees, then it needs to send them to Bank B in America where they also have to pay transaction fees, if you would add that up with the fact that it would usually take one day for the transaction to settle, Bank A would lose up to 5% on this payment only on fees and commissions.
But with RippleNet, Bank A has to convert its money to XRP and then send it instantly to Bank B where it’s converted automatically to USD – Lower fees and instant transactions with the possibility of real time traceability of funds.
So people make a big mistake thinking that if a bank decides to use Ripple as a vehicle for money transportation, it would drive the prices up when they would put a buy order on XRP to convert their funds.
Ripple has an agreement with every bank that whenever they use XRP to transport money around the world, they would have the same price for any type of conversion (buying or selling) – They are not allowed to sell the tokens on the marketplace therefore they don’t influence the actual price.
So as you can see, Ripple’s price is only driven by investors, and not by adopters, that’s why, Ripple can be used by every bank around the world and have no influence at the price at all, despite the fact that it would get more media attention, driving more people to invest in it.
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