It's not clear what the use case is. It's not clear the what value proposition is. Long term value will be dictated by the utility of that asset
Despite the notion that high-flying startup Ripple is the blockchain or cryptocurrency company, CEO Brad Garlinghouse feels it’s something simpler than the technical buzzwords. “We are a payments company,” Brad Garlinghouse said on Tuesday at a Goldman Sachs technology conference in San Francisco.
Talking with the audience Brad said he is convinced “most” cryptocurrencies will lose their value. In a nutshell, he is convinced that almost all of the coins are simply just not as useful as transactional money, meaning there is no reason for these to exist.
“It’s not clear what the use case is. It’s not clear the what value proposition is,” he told the audience. “Long term value will be dictated by the utility of that asset,” he added.
He discussed that Ripple uses blockchain technology–one of the root accounting solutions used for Bitcoin–to record deals between banking companies. And he said that his company uses its XRP cryptocurrency as a repayment solution to make it easier for banking companies to move money internationally.
Ripple sells payment software and the right to use its XRP cryptocurrency to large banking institutions. However, its biggest challenge is to convince financial institutions to improve how they are doing business for a long time. The largest obstacle in convincing finance institutions to work with Ripple’s services is that many financial institutions have other IT-related projects that are a bigger concern to them than Ripple, Brad stated.
The hope is the fact major banks will use Ripple’s xCurrent repayment software and related XRP cryptocurrency rather than the industry standard SWIFT software to send money across borders. Unlike some cryptocurrency advocates, Brad feels the ultimate way to bring cryptocurrency to the mainstream is to “work within the system” instead of using cryptocurrency to circumvent government regulations and financial institutions.
Ripple technology has been adopted by companies such as UniCredit, UBS or Santander and payment networks as a settlement infrastructure. The Ripple protocol thus integrates the banks existing networks and allows free exchange and transfer of funds.