We don’t need to search far and wide to find news regarding Ripple establishing partnerships with large banking firms - take Santander’s One Pay FX app for example.One Pay FX is just one example that see’s Ripple working closely alongside a major banking group, other examples would include SBI of Japan and ATB Financial of Canada. A key part of the Ripple business model is the provision of major partnerships. By working with major national banks, Ripple are ensuring the adoption of their technology, giving them new customers and a guaranteed workflow that should be around for years to come.We must point out that these partnerships do not aim to encourage the adoption of XRP just yet. Of course, the adoption of xRapid does in turn bring XRP to the fore, however, Ripple are not yet ready to see the adoption of XRP as a live currency, instead, it is still simply used as a small part of the overall technology package that Ripple are offering these banks.Even so though, people still expect that these partnerships will have a positive impact on XRP, because XRP is gaining attention as a result of this. Now, we can assume that this attention will encourage more investment into XRP, though if this was really the case, would XRP still be valued as poorly as it is at the moment?Are these partnerships making an impact?Bravenewcoin.com have published an article that discusses some research into this, by looking at XRP on a network level, it becomes evident that Ripple’s partnerships are not having a major impact and thus, we are not seeing the results we would have expected to see in XRP a year ago. According to Bravenewcoin:
“The suite of tools for enterprise and banking solutions that make up RippleNet is currently available in 40 countries. The tools are provided by the company behind XRP, Ripple Labs, and include; xCurrent, which processes global bank to bank payments for customers and is analogous to SWIFT; xRapid, which went live on October 1st and sources on-demand liquidity through buying and selling the XRP token; and xVia, which plugs into RippleNet to send unidirectional payments. A report by RBC capital markets in late June found that RippleNet processed transactions in 3-5 seconds, as opposed to multiple days when compared to traditional settlement procedures, and saved users 46% in costs.”
So, the testing done by these banks has been a success, Ripple’s new partners are seeing the intrinsic benefits of using Ripple’s technologies to facilitate international payments (for example), but still, across the Ripple network it is hard to see any real benefits.
“On the network side, there are 921 public nodes with 140 validators. The top 100 largest XRP accounts hold 80% of the money supply. Transactions per day have continued to decline since January, and are currently at levels last seen in 2014.”
It seems that transactions across XRP are at a low not seen since 2014, many years before these partnership announcements could have ever been imagined. This means that less XRP is being moved around the Ripple blockchain, erasing the notion that Ripple’s partnership announcements will encourage a greater flow of XRP. Furthermore, on the matter of active addresses:
“Daily active addresses (DAA) have decreased substantially since January although data between April and July is absent. DAA is currently sitting at levels last seen during the July to October period last year. A large uptick in DAA should be seen as a bullish indicator for price, as it suggests increasing demand.”
With less addresses moving XRP, we can’t actually expect the price to move. As the quote above states, an increase in DAA could suggest a price climb, though we seem a way off this. As the research continues to suggest, people aren’t moving XRP around, it’s being left to stagnate, the opposite effect that we would expect from major partnership announcements. Finally, less people are trying to find out more about XRP too:
“Google Trends for the term ‘XRP’ remain down sharply over the course of the year with a small spike in September. A slow rise in searches for ‘XRP’ preceded the bull run in Q4 2017, likely signaling a large swath of new market participants at that time. A 2015 study found a strong correlation between the google trends data and bitcoin price. A May 2017 study concluded that when the U.S. Google ‘Bitcoin’ searches increase dramatically, bitcoin price drops.”
What we should take from thisIt might all sound a little bit complicated, but, from the findings reported by Bravenewcoin we can see that less XRP is being moved around, less addresses are actually moving XRP around and finally, less people are using the internet to find out more about XRP.Interest is down, investment is down and overall, the XRP community look as if they are feeling quite pessimistic. Clearly the new banking partnership announcements have not had a major impact on XRP, though it doesn’t mean this is bad news. XRP is suffering from the bear market at the moment, therefore we can’t write it off just yet. Through more partnerships and through more growth from Ripple, XRP is expected to climb once again. A future potential price of $3.00 and beyond is not unrealistic for this cryptocurrency and therefore, XRP is still a product that we are very excited about.Perhaps going forward, Ripple can help XRP benefit by really milking the benefits of their future banking partnerships, and expressing to their following just how important those partnerships are, that way, XRP might start to see the benefits of the amazing work that is being done by Ripple.