U.S. fintech firm Ripple and MoneyGram International (MGI) have “together decided to wind down” their relationship, and end their partnership, Ripple said in a press release on 8 March.
While the two companies have decided to end their relationship, Ripple stated they could still work together in the future, as they still believe in the ability of “digital assets and blockchain technology to change the status quo in global payments”. Ripple’s CEO, Brad Garlinghouse, said the partnership between the two firms had been quite successful so far — with them having “processed billions of dollars through RippleNet and On-Demand Liquidity” — despite the lack of crypto regulatory clarity in the U.S.. He tweeted:
“While the lack of a crypto reg framework has needlessly muddied the waters for U.S. businesses & consumers, there’s no denying what Ripple and MGI have achieved together. Billions of dollars have been sent and settled across borders through ODL w/ XRP.”
Even though Ripple and MGI first announced their strategic partnership in June 2019 — with Ripple investing $30 million in MGI, and MoneyGram agreeing to use XRP and xRapid for their settlement operations — the two firms have actually been working together since 2018. The partnership — that was meant to expire in 2023 — has so far netted MGI around $62 million in “market development fees” from Ripple.
Back in December 2020, the U.S. Securities and Exchange Commission filed a lawsuit against Ripple and its executives — alleging the firm had raised more than $1.3 billion in an “unregistered, ongoing digital asset securities offering” — which resulted in MGI suspending its agreement with Ripple in February.
While the SEC lawsuit had hurt Ripple’s business in the U.S. — with its native currency XRP getting delisted from a number of U.S. exchanges — it did not impact the Asia Pacific region. Last week, Garlinghouse commented that Ripple’s business in Asia and Japan has “continue to grow” all thanks to the “regulatory clarity” in those markets.