Thanks to the ongoing legal battle against Ripple Labs by the US Securities and Exchange Commission, or SEC, MoneyGram has decided that the best solution in this situation is to officially cut ties with the firm.
Good Relationships Going Sour
It was all the way back in December of 2020 when MoneyGram, a NASDAQ-listed firm, opted to suspend the use of the XRP token for FX settlements within its cross-border payments processes. This, again, is thanks to how heavily under fire the XRP token is, as the SEC declared it to be an unregistered security and Ripple Labs did everything in its power to get the matter thrown out of court.
It should be noted that Ripple and MoneyGram had signed an agreement back in 2019. This agreement made Ripple provide incentives for MoneyGram, based in Dallas, to use the on-demand liquidity services of Ripple.
Previous Statements Going Sour
Through the use of XRP transfers, the money-transfer company revealed that it had managed to net in over $60 million in transaction fees through the use of XRP transfers. It used this as an alternative revenue source for settlement and payment services. When Moneygram suspended Ripple’s token settlements, Ripple tried its best to do damage control.
In a public statement, Ripple Labs declared the partnership between it and MoneyGram to still be ongoing, claiming that the suspension is really just a temporary measure until things blow over and that this partnership extends further than just using its network.
It seems that there was a severe case of miscommunication on that front.
The Official Farewell
In the public announcement regarding this, Ripple explained that it was the mutual decision from both Ripple and MoneyGram to officially end their ongoing partnership agreement. Of course, the mandatory kind words were bound to come, with Ripple declaring its pride in the work it’s done in such a short time frame with MoneyGram.
Ripple further highlighted the apparent impact it had with the first-of-its-kind product within the global market. Ripple proudly declared that billions were processed by way of On-Demand Liquidity (ODL) and Ripplenet.
The interesting part about this, is the apparent lack of impact on the price actions of XRP. The asset, in light of the payments giant essentially booting one of the biggest cryptocurrencies out there, managed to gain 2%.
The decision itself comes, rather obviously, from the fact that the SEC is breathing down Ripple’s neck, having filed a lawsuit against Ripple claiming it was an unregistered security. The asset saw a spectacular nosedive in price then, but managed to claw its way back up to its current price.