OFX could be affected by the exceptional performance of Ripple
March 13, 2018 1:00 pm
Big money transfer banks to be affected by Ripple(XRP)
Investing in cryptocurrencies nowadays is like investing in the internet in the 1990s. Big winners and losers will always be there; the game changer will be the underlying blockchain technology supporting these cryptocurrencies.
Business establishments that transfer money across the world such as Western Union which is the most prominent one, big banks like Commonwealth Bank of Australia, Westpac Banking Corp, Australia and New Zealand Banking Group and National Australia Bank Ltd. Where it takes up to 3 days to process the transactions and also it is expensive since the currencies have to be converted into a standard global currency.
This strategy was supposed to be followed by OFX Group Ltd. OFX specializes in global money transfers made within one day at rates that are cheaper than the big banks.
OFX also a provided a constructive trading update to the market today showcasing the volume and average value of transactions which increased in 2H18 compared to 1H18.
OFX’s view of their competitive advantage in the market is shown below:
Due to their cheaper services compared to other banks in addition to the excellent services supported by a robust risk management framework, makes OFX competitive compared to big banks.
Hence, considering Ripple (XRP) which is a cryptocurrency with a scalable network that enables real-time payments and money transfers in any part of the world. Ripple continuously handles 1,500 transactions per second, 24×7 which is the same throughput as Visa.
Therefore, it can be said that OFX could be affected by the scalability and transfer speed of Ripple but could also benefit OFX if they successfully adopt the technology. Such an action was performed by Moneygram where they announced their partnership with Ripple earlier this year.