Cryptocurrency startup FXcoin Ltd. and Japanese financial giant SBI Holdings have begun testing the use of XRP to settle corporate debts and credits.
FXcoin is conducting the experiment, which involves the Sumitomo Corporation, a Japanese general trading firm, settling debts and credits to other Sumitomo Group companies with XRP.
Sumitomo Corporation will also “make a future transaction with [FXcoin] to hedge the price movement of XRP and sell XRP to [FXcoin] on a specific date,” according to a translated press release from the cryptocurrency startup.
“This is expected to lead to the expansion of XRP-denominated transactions in the future in the activities of globally expanding operating companies.”
FXcoin also believes the experiment will lead to the establishment of a swap market of cryptocurrencies listed by the company.
SBI is also teaming up with FXcoin to test the use of XRP in the $6.6 trillion foreign exchange (FX) market. The test is designed to determine whether the speed of XRP can be used as a bridge asset to lower the risk of price fluctuations that can occur as one currency is traded for another, as well as determine potential savings on fees associated with the transfer.
Ripple and SBI are longtime partners, and SBI invested in the San Francisco-based payments company back in 2016.
That same year, the pair launched SBI Ripple Asia in an effort to bring payments powered by distributed ledger technology to financial institutions and remittance transfer providers in the region.
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