Despite the epic XRP price crash in January, Ripple’s main partner in East Asia—a Japanese financial services provider called SBI Holdings Inc (TYO:8473)—doubled down on its support. It even launched a digital asset exchange: SBI Virtual Currencies.
At first, this doesn’t sound like big Ripple news. One more exchange. Big deal.
But if you take a closer look at the release, you’ll notice two things:
- SBI Securities, a subsidiary of SBI Holdings, has four million brokerage accounts, making it Japan’s biggest online securities company.
- XRP is the first crypto listed on the new exchange.
This is a big deal. It is the equivalent of Charles Schwab Corporation (NYSE:SCHW) opening a crypto exchange in North America and lending its support to one particular crypto. No financial service provider would make that decision lightly. It is a long-term commitment.
SBI CEO and Executive Chairman Yoshitaka Kitao explained the decision to Ripple, saying: “Not only does it have a clear use case, XRP is faster, cheaper and more scalable than any other digital asset. I strongly believe it will become the global standard in digital currencies.” (Source: “SBI Virtual Currencies to Exclusively List XRP at Launch,” Ripple, January 30, 2018.)
What he means is that XRP can handle 1,500 transactions per second. If needed, the network can be scaled to accommodate as many transactions per day as Visa Inc (NYSE:V) or Mastercard Inc (NYSE:MA). Bitcoin and Ethereum do not have that capability.
So why are BTC and ETH the first cryptos listed on most exchanges? It leads to so many complications. Most investors looking to buy altcoins have to use Bitcoin as an intermediary, meaning that they’re wasting money on outrageous transactions fees.
Having XRP as the main road to other cryptos is a clever move by SBI. But it also goes a long way to establishing XRP’s credibility among the financial institutions in that part of the world.
“Today’s decision to make XRP the primary digital asset of SBI Virtual Currencies shows the utility, efficiency, and scalability respected financial institutions around the world see in XRP,” said Patrick Griffin, Ripple’s senior vice president of business development. “This is a critical step forward in our mission to build XRP liquidity and build an Internet of Value.”
This news perfectly represents why I continue to believe in our $10.00 Ripple price prediction for 2018.
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