Ripple Inc. is going to invest up to $50 million in MoneyGram International Inc. according to The Wall Street Journal. This deal will rank the American startup and issuer of XRP among the first crypto-related companies to invest in a leading American publicly listed company.
Ripple agreed on buying $30 million MoneyGram stock with guarantees of $4,10 per stock which is almost three times more than the price from their last stock exchange session of $1,45.
Furthermore, the agreement includes a guarantee that Ripple will buy $20 million of any newly issued stock. This agreement is active for the next two years at a price of $4,10 for a share. The contract allows MoneyGram to use XRP and xRapid, Ripple’s payment network, as a backoffice method for their settlement operations.
The current contract comes as a sequel to their 2018 mutual work. Last year MoneyGram used Ripple’s cryptocurrency through their testing platform.
Ripple’s Chief Executive Brad Garlinghouse commented on the significance of the move:
“This deal is a major milestone for the entire industry.”
This news, should not come as surprise as Ripple already has numerous banks as customers, including Banco Santander, UBS Group and Banco Bilbao. As for MoneyGram, they are still ranked number 2 in the money transfer sector after Western Union.