Ripple CTO explains why they chose fiat-to-fiat transactions before moving to ODL

Alex Dovbnya

Ripple CTO David Schwartz explains why they initially opted for fiat-to-fiat transactions without deploying the XRP infrastructure

contents

  • ODL can work with “cut out a piece”
  • Further ODL corridors

In a new tweet, David Schwartz, CTO of blockchain payment provider Ripple, explained why Ripple chose xCurrent before moving to the on-demand liquidity (ODL) solution, which enables instant cross-border payments.

The executive claims that fiat-to-fiat transactions did not require fiat-to-fiat transactions, which is why they could be delivered more quickly. XRP is handy for “getting the most impact” when it comes to tapping into a “ready customer base.”

BlackImage by @JoelKatz

ODL can work with “cut out a piece”

Ripple aims to address one of the old banking system’s biggest shortcomings by eliminating the need for pre-financing.

The product formerly known under the name xRapid is able to bridge various fiat currencies in a very short time, with XRP serving as a source of liquidity. xCurrent, Ripple’s previous generation product, does not use the token to process transactions.

When asked if ODL could work without buying or selling XRP, Schwartz replied that it could still work with “a piece cut out,” meaning it doesn’t necessarily have to be a fiat-to-fiat transaction.

For example, this could be the case that the sender already has XRP or the recipient is ready to accept the token instead of fiat.

Further ODL corridors

Several Ripple partners like FlashFX and MoneyGram currently rely on ODL to transfer money. Mercury FX recently confirmed that it is still using the product with the help of XRP and teased “exciting news”.

So far, Ripple has ODL corridors in Australia, the Philippines, and Mexico that routinely hit new all-time highs in terms of transaction volume.

As reported by U.Today, Ripple is expected to open new ones this year targeting Brazil and other Latin American countries.

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