“Due to the uncertainty concerning their ongoing litigation with the SEC, the company has suspended trading on Ripple’s platform,” says MoneyGram’s quarterly outlook.
February 23, 2021 | AtoZ Markets – MoneyGram, a global money transfer service company, said that it has changed its partnership with blockchain payments firm Ripple amid the latter’s lawsuit with the Securities and Exchange Commission (SEC).
According to MoneyGram’s quarterly outlook, the company “does not plan to get any revenue from Ripple market development fees” in the first quarter of 2021. MoneyGram said that in the same period last year, the company’s net expenditure income from Ripple exceeded $12 million.
MoneyGram Suspends Trading on Ripple Platform
MoneyGram said: “Due to the uncertainty of Ripple’s ongoing litigation with the SEC, the company has suspended trading on the Ripple platform.”
The cooperation between the two companies mainly began three years ago, when MoneyGram integrated XRP into its payment system. In the second year, Ripple and MoneyGram reached a cooperative relationship on cross-border payment and foreign exchange settlement of digital assets.
In November 2019, Ripple invested $50 million in exchange for a 10% stake in MoneyGram. As of December 2020, Ripple has sold approximately $15 million in MoneyGram stock.
However, amid the news in December 2020 that the US SEC would be taking legal action against Ripple as well as its CEO, Brad Garlinghouse, and co-founder Christian Larsen, MoneyGram has seemingly attempted to distance itself from the firm. A few days after the SEC announcement, MoneyGram said it had never utilized Ripple’s On-Demand Liquidity and RippleNet services “for direct transfers of consumer funds.”
MoneyGram is not the only company responding to the SEC’s lawsuit against Ripple. Many crypto exchanges have delisted XRP tokens or suspended trading.
Although the aftermath of the lawsuit initially caused the price of XRP to drop, XRP basically recovered within two months. At the time of writing this article, XRP is currently at $0.43.
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