Ripple comes with a new fast and cheap On-Demand Liquidity payment service for businesses in Brazil.
Crypto usage in Brazil
Ripple’s XRP coin is ready to be used to facilitate fast and cost-effective cross-border transactions in Brazil. Ripple announced on August 18 that Travelex will use RippleNet’s ODL. The goal is to facilitate cross-border payments between companies by using Ripple’s XRP. It is also noteworthy that Travelex is the first bank approved by Brazil’s central bank to operate exclusively in foreign currencies.
Other Latin American companies such as Banco Rendimento, Remessa Online, Frente Corretora, and Banco Topazio have already used the services of RippleNet. This is the first time a Latin American bank has used ODL, according to Ripple.
Travelex will initially enable these cross-border payments between Brazil and Mexico. Plans have already been made to open more payment options in the region. The goal is to create more use cases that fit the needs of enterprises.
The news comes at a time when the Brazilian government passed its first Bitcoin law. The goal was to create a regulatory framework on how cryptocurrencies would be regulated.
Brazil is also in the process of adopting a central bank digital currency (CBDC). However, the decision is controversial. Economist Fabio Araujo says the following:
A CBDC will be able to stop the bank runs. In addition, it may impose other restrictions on its citizens.
Brazilian interest for Ripple
Ripple CEO Brad Garlinghouse said Brazil’s adoption of a crypto-friendly regulatory framework and rising institutional interest in digital assets make the country a great format for the ODL:
Brazil is an important market for Ripple. In Brazil there is a lot of interest for business, there is openness to crypto and there are many initiatives that promote the fintech industry. As a result, the market is experiencing an explosion of activity. Institutions want to adopt crypto and blockchain technology to solve customer pain points.
More than $780 billion in payments flow to Brazil every year. Travelex’s use of the ODL service will make payments much more efficient according to Garlinghouse:
From day one, we focused on building solutions that are useful. We are excited to partner with an innovative partner like Travelex Bank to move money more efficiently. This is for the benefit of its customers throughout Brazil.