Ripple CEO Brad Garlinghouse, in a recent interview with CNBC, spoke at length about the fintech startup’s various products, and the utility of its native XRP token. Commenting on its value, Garlinghouse said he “wouldn't even dare try” predicting XRP’s price.
Explaining the difference between Ripple and XRP, the CEO stated that XRP is a digital asset which makes cross-border payments efficient due to its high transaction speeds and low fees (as compared to Bitcoin).
Ripple, on the other hand, is a payments company which utilizes the open-source XRP eco-system to facilitate parties with liquidity problems, such as banks.
“How do we make cross-border payments massively more efficient, for remittances for corporates...we use XRP because it's a thousand times faster than bitcoin transactions and a thousand times cheaper than a bitcoin transaction.
So, Ripple the company is really building on top of this open-sourced eco-system that I call the XRP eco-system, and Ripple's building vertically on top of that – as a payments company.”
When questioned about whether banks really need XRP to take advantage of the solutions Ripple offers, Garlinghouse explained that Ripple offers two products – xCurrent and xRapid. xCurrent allows banks to settle transactions in fiat, but they need to be pre-funded to do that; xRapid, on the other hand, removes the need for pre-funding by utilizing XRP.
Speaking about the utility and scope of the XRP token, Garlinghouse stated that xRapid had a beta launch late last year, and is currently being used by several high-profile remittance companies (such as Western Union and MoneyGram) which are effectively saving up to 70% on their transfers, as compared to existing methods.
As xRapid moves out of beta, Garlinghouse believes more companies will start to use it, and will consequently require XRP, thus bolstering the ecosystem.
“We're one player in the XRP eco-system but there's other players as well and so I think as we do things that enhance the utility of XRP we'll continue to see that eco-system grow and be healthier and healthier.”
Currently, XRP is trading at around $0.66 – a significant drop from its early January peak of over $3.50. However, the bearish trend is not unique to XRP – the wider cryptocurrency market has been caught in a down-trend since January this year, and the Ripple CEO blames “hype” for the price volatility.
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