MoneyGram, a global money transfer service provider, said it has suspended its partnership with blockchain payment firm Ripple, whose lawsuit is ongoing with the Securities and Exchange Commission (SEC).
According to MoneyGram’s quarterly estimates, the company “does not plan to earn any revenue from Ripple market development fees” in the first quarter of 2021. MoneyGram reported that the company’s net spending income from Ripple in the same period last year exceeded $ 12 million.
MoneyGram suspended trading on the Ripple platform, “due to the uncertainty of Ripple’s ongoing lawsuit with the SEC.” The partnership between the two companies started 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 currency exchange 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 about $ 15 million in a share of MoneyGram.
However, amid the news that in December 2020 the SEC will take legal action against Ripple, as well as its CEO Brad Garlinghouse and its co-founder Christian Larsen, MoneyGram has apparently tried to distance itself from the firm. A few days after the SEC announcement, MoneyGram said Ripple never used Liquidity On Demand and RippleNet services “for direct transfers of consumer funds.
MoneyGram is not the only company to respond to the SEC’s lawsuit against Ripple. Many crypto exchanges have removed XRP tokens from the list or suspended trading.
In addition to these, in the statement made by Ripple regarding the development of MoneyGram, “We signed a long-term agreement with MoneyGram, which is still in effect in 2019 and is not limited to the use of the company’s ODL. Together we are actively investigating alternative use cases. We look forward to finding a forward-looking formula with MoneyGram, and we believe that the end of this case will lead to more legal clarity in the US regarding the use of digital assets and blockchain technology. As we said earlier, the lawsuit against Ripple has unnecessarily muddyed water and created more uncertainty for exchanges, market makers and businesses. expressions were used.