Ripple has ended its partnership with money transfer service MoneyGram. This was announced by the CEO of the California-based company Brad Garlinghouse.
Today, we’re announcing that Ripple and MGI have together decided to wind down our current partnership agreement, and are both committed to revisiting it in the future. See our full statement: 1/2 https://t.co/KGOzPWuThR
– Brad Garlinghouse (@bgarlinghouse) March 8, 2021
According to him, in the future the firms intend to revise the terms of the partnership agreement.
“While the lack of a framework for regulating cryptocurrencies has unnecessarily muddied the waters for businesses and users in the US, the joint accomplishments of Ripple and MGI [MoneyGram] cannot be denied,” Garlinghouse said.
In the summer of 2019, the service began processing cross-border payments through the On-Demand Liquidity (ODL) system using the XRP token. For interaction with ODL MoneyGram received commission in XRP.
In November 2019, Ripple closed a $ 50 million deal , receiving 9.95% of the partner’s common shares. In the second quarter of 2020, the company paid $ 15 million to the service , in the third – $ 9.3 million .
The head of MoneyGram, Alex Holmes, said that over 18 months of cooperation with the fintech company, the number of transactions increased by 220% , and the number of online clients increased by 140%.
In December 2020, the US Securities and Exchange Commission accused Ripple of selling unregistered securities in the form of tokens worth $ 1.3 billion. Later, the regulator clarified the responsibility of Garlinghouse and co-founder Chris Larsen.
Against this backdrop, a number of cryptocurrency platforms and firms have dropped support for the XRP token. Among them are Coinbase and OKCoin , Galaxy Digital , Grayscale Investments and Bitstamp .
Since the filing of the lawsuit, MoneyGram has taken a wait and see attitude . In February 2021, the service refused to use the product based on the XRP token, citing uncertainty regarding Ripple’s litigation with the US authorities.
As a reminder, Rosen Law Firm’s lawyers have filed a class action lawsuit against MoneyGram. In their opinion, the company did not warn about the possible recognition of the XRP token as a security and the potential loss of a source of income in the form of commissions.