Three MIT students that are in their early 20s developed a technology that could draft email predictive responses. Back in May last year, they embarked on fundraising for their startup, EasyEmail. Within that same period, Google held its yearly conference, and the tech firm announced a feature that is similar to that of the MIT students.
Filip Twaroswki – the founder of the startup – was shocked by the announcement of Google, and he was scared that competing with such a huge tech firm would scare off venture capitalists. Entrepreneurship history comprises of many stories in which more established companies try to squash young startups by copying them. What they do most times is to acquire startups in order to eliminate threats. However, the former is the case of JP Morgan.
The New Digital Currency of JP Morgan Is a Threat to Ripple
JP Morgan is a multinational banking giant and the bank just adopted an idea made famous by Ripple Inc. The idea is that blockchain can carry out international transactions much faster and cost-effectively than the normal interbank payment system. As such, the company replaced the distributed ledger of Ripple with an Ethereum-based Quorum blockchain and the XRP (XRP) token with its new stablecoin – JPM Coin.
The JPM Coin of JP Morgan – which perhaps should not even be referred to as a digital currency – combines the best of both the digital currency world and mainstream finance. The project uses blockchain tech to process international settlements faster while protecting its users from volatility associated with digital currencies such as XRP (XRP).
Because the digital currency of JP Morgan can be transferred from the account of one JP Morgan client to another, the digital currency appears to be more attractive than the volatile XRP (XRP).
In its FAQ section, JP Morgan wrote: “Exchanging value, such as money, between different parties over a blockchain requires a digital currency, so we created the JPM Coin.”
In fact, a corporate firm copied a young company and manage to project its venture as better. Situations like this have not really favorable to young startups. However, according to Brad Garlinghouse – the CEO of Ripple – Ripple is not afraid squaring off against such Wall Street Behemoths.
The Digital Currency of JP Morgan Misses the Point – Brad Garlinghouse
In a tweet, the CEO of Ripple said that the latest attempt of JP Morgan to launch a digital currency missed the point. Garlinghouse said that the digital currency of JP Morgan relied on a “closed network,” which is not innovative in any way.
The former Yahoo executive said: “As predicted, banks are changing their tune on digital currency. But this JPM project missed the point – introducing a closed network today is like launching AOL after the Initial Public Offering (IPO) of Netscape.”
JP Morgan might end up taking clients that basically use XRP (XRP) for international transactions. On the other hand, Ripple will need to set its priorities straight. A stablecoin to settle transactions between different banks might be the right answer.
XRP (XRP) Price Today – XRP / USD
At the time of writing, XRP (XRP) is changing hands at 30 cents after decreasing by less than 1 percent over the past twenty-four hours. XRP (XRP) currently has a market cap of $12.46 million with a trading volume of $424.7 million over the past twenty-four hours.