The major international financial services provider Western Union has confirmed to be conducting tests using Ripple but has no plans to use cryptocurrencies.
Western Union has been actively involved in cryptocurrencies ever since 2016 when they invested $50 million in the Digital Currency Group (DCG). DGC is perhaps best knowns for its various subsidiaries which include Ripple, CoinDesk, and many more.
This tie perhaps explains why Western Union is currently experimenting with Ripple. Previously, Western Union stated that they intended to stay close to the new fintech industry but that they had no plans to implement a cryptocurrency-based payment system in the foreseeable future. While the company has confirmed that they are testing the possibilities with Ripple, it seems unlike that this position will change.
Western Union and cryptocurrency
Earlier this week, the CEO of Western Union, Hikmet Ersek, clarified the major firm’s position when it comes to cryptocurrency and whether Western Union is likely to adopt blockchain technology or crypto payment options.
According to Ersek, the company’s interest in Ripple testing simply stemmed from their belief that they should stay relevant and interested in the developing blockchain and crypto industries.
Ersek stated that at the moment, Western Union was currently more interested in blockchain technology instead of cryptocurrencies, as blockchain offered Western Union such more practical use. The CEO added that Western Union is currently conducting some tests with Ripple to investigate possibilities when it comes to transaction settlements.
Lack of regulation and other concerns
The CEO stated various concerns that Western Union had surrounding cryptocurrencies such as the fact that they carry no inherent sanctioned value as well as regulatory challenges.
Ersek stated that Western Union would give cryptocurrencies more consideration if they demonstrated more utility, but since the mainstream environment does not allow users to pay school fees or buy a carton of milk using bitcoin, the possibility seemed impractical.
In addition, there is the growing concern of the crypto regulation all over the world.
Ersek emphasized that regulation is a top priority for Western Union, especially because they are a highly regulated environment. According to the CEO, strong regulation is one of Western Union’s biggest strengths as they are a regulated firm in over 200 countries and comply with over 40,000 pieces of regulation at any given point in time. This is why regulation is important for the firm so that they can serve their customers in a better way.