Bitcoin stumbles below $10k: Saudi shows how Ripple makes millions
All of the top 100 cryptocurrencies by market capitalization, except 3 posted red numbers Thursday, according to CoinMarketCap data.
Bitcoin (BTC) dropped over 8% in the last 24 hours, and as of writing, BTC had dropped to $9,860 range, down close to 17% from the recent high of $11,958 hit three days ago.
The biggest loser among the top 10 cryptocurrencies was bitcoin cash (BCH), down 11% in one day and 24% in 72 hours.
According to the Coin telegraph, the second largest crypto Ethereum, edged closer to $800, quoting CoinMarketCap.
The total value of all cryptocurrencies dropped to $430bn down 15% from the high of $519bn on Feb. 18, but still 61% above Feb. 6’s low of $276bn.
The good news is that transaction fees needed for cryptos are also down.
Lower fees symptom
According to Coindesk, the average cost of sending a bitcoin transaction is cheaper than it’s been in a year and a half.
Litecoin and Bitcoin Cash solved that high fee problem that plague Bitcoin, and make them an overnight success.
“Bitcoin is a software that requires all of the many thousands of computers that run it to stay in sync. To do so easily, there’s a limit on how much data the network can process at intervals, and users need to pay more to get their transactions in at times of congestion,” said Coindesk.
So, as Bitcoin grew more popular in the last year, fees skyrocketed to over $25, according to Bitinfocharts.”
But, bitcoin fees have been declining since the end of December, down to $3.
One reason: users are making fewer transactions right now.
“In December, there were roughly 400,000 transactions per day, while today bitcoin is seeing only 200,000, according to data from Blockchain.info,” said Coindesk.
“Also, fee prices forced some large transaction processors to implement a technology called ‘batching’, rolling many transactions into one, to leave more space on the blockchain.”
Ethereum, has also seen a dramatic drop in fees in recent months, from a high of over $4 in January to below $1 now.
So which crypto is showing the most promise among rivals?
An agreement signed by Saudi’s Central bank to enable local banks to deploy Ripple’s xCurrent crypto for cross-border payments could lead to savings of up to $400 million, according to Moody’s Investor Services.
It’s a unique program by any central bank, although in 2017, the Bank of England completed a proof of concept on distributed leger technology or blockchain.
“A successful pilot likely will lead Saudi banks to integrate DLT into their existing payment infrastructure, improving payment transparency and efficiency,” Moody’s said in its Credit Outlook, as reported by Arabian Business.
“Saudi banks will potentially improve their profitability on cross-border transactions by reducing the cost of each transaction, while gaining revenue with higher volume as the customer experience improves with the saving of money and time.”
There will also be Savings on remittances, as workers will favor the low-value transactions involved using Ripple.
“The World Bank estimates that fees on remittances average a high 7.1% of the transaction volume, and we estimate that cost could fall 50% with Blockchain,” Moody’s said.
Ripple makes new global partnerships
According to Coindesk, Ripple recently announced new partnerships with five banking and money transfer institutions across four different countries.
A press release from Business Wire reported that two banks – Itaú Unibanco from Brazil and IndusInd from India – along with money remittance companies InstaReM from Singapore, Beetech from Brazil and Zip Remit from Canada, will be adopting different Ripple platforms to facilitate real-time international payments.
“In addition, both Beetech and Zip Remit plan to ultimately create a working relationship with China-based LianLian, which recently began using xCurrent,” said Coindesk.
Ripple’s head of business development, Patrick Griffin, added that the new partnerships will particularly assist customers in emerging markets, explaining:
“Whether it’s a teacher in the U.S. sending money home to his family in Brazil or a small business owner in India trying to move money to open up a second store in another country, it’s imperative that we connect the world’s financial institutions into a payments system that works for their customers, not against them.”