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19/06/2019
Technology

Visa Inc. Acquires Earthport for $250 Million to Boost Cross-Border Payment Business

In a major development of acquisition, American credit card giant Visa Inc. has purchased Earthport, a British payment firm, by paying an amount of $250.6 million. Earthport is an organization involved in the business of cross-border payments having clients across business segments especially in the banking sector. Earthport is a partner to Ripple in its blockchain-based payment system since the year 2015.

Visa’s Expansion Strategy

According to Reuters, Visa has paid four times the stock price of Earthport recorded on December 26. The reason behind the acquisition is the expansion intent of Visa. The company is looking forward to enhancing its cross-border payment network which has already recorded a growth of 10% in Fiscal 2018. The company believes that with this acquisition, the growth rate can be further stimulated.

API and DLH  

Earthport utilizes an application program interface (API) in order to carry out cross-border transactions for managing and settling the funds with its local partners. The client list of Earthport includes the likes of Ripple, Bank of America, Japan Post Bank, Hyperwallet, Transferwise among others. The company has the distinction of launching the world’s first DLH – distributed ledger hub – which allows the clients of the company to use its distributed ledger Technology through a single API, which is the first of its kind that financial industry witnessed at its inception. The API, in addition to providing access to the Ripple payment ecosystem, allows the user to have access to some other payment methods that the company offers in more than 200 countries worldwide.

Ripple CEO’s viewpoint

Brand Garlinghouse, the Chief Executive Officer of Ripple, in November 2018 revealed that the company had already signed with at least a hundred SWIFT-connected banks. SWIFT, which stands for society for worldwide interbank financial telecommunication, earlier expressed its doubt that cryptocurrency and blockchain technology won’t be able to play a major role in the banking industry. Garlinghouse said that the long list of the company’s client is a testimony that SWIFT’s prediction is untrue. This also explains the $50 million donations by the Ripple’s CEO to the 17 universities around the globe for strengthening the adoption of blockchain technology. Amusingly, that donation was made in dollars, not in the cryptocurrency. Ripple claims that the interest in the blockchain technology is only increasing as more and more people are becoming aware of the game-changing potential of this open Distributed Ledger Technology (DLT).

Brad Garlinghouse also expresses the supreme confidence on the potential of Ripple, the blockchain, and the overall crypto industry. He pointed out that Ripple’s own XRP is rapidly spreading its wings and remains the only digital currency to get successfully integrated with the payment system of big banks and smoothly working on its own blockchain platform. He predicts that XRP has the potential to eventually surpass the Bitcoin and even if Ripple were to shut down, XRP would continue to trade on other exchanges around the globe.

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