Alright guys, its been a hell of a week for Ripple and crypto in general. We are witnessing the beginning of a banking revolution- its only going to get crazier as we head into 2020.
PART 1: Let me start this post by telling you a conversation I had with my mother, an executive loan officer and branch manager of a regional bank in the south:
After the usual mother/son conversation, I asked her how her job was going since she just came back from family leave. APPARENTLY....
"The top executives are freaking out. The projections for loan income are completely off due to the FED announcement."
If you're not in the US, basically the central bank wants to lower interest rates next month. The effect? Here is an excerpt from a Yahoo Finance article:
So, US banks will be struggling to make the quota for this fiscal half because the banks projected the rate to actually increase rather than decline. This meant that many banks gave adjustable rate loans to borrowers in hopes that the prime rate would increase over time.
PART 2: Responses from other banks have ranged from nonchalant to panic
As you can imagine, banks want to keep a lid on their panic state. Most have released statements that say they were prepared for the rate decline. Some are in denial and think the FED will call back on its majority vote to cut the rate
Once Goldman Sachs executive went all the way to say smaller banks are screwed
Based of the conversation with my mother, I would agree that the banks are concerned and stand to lose a lot of money.
PART 3: ENTER CRYPTO- Libra is announced, and the Moneygram Move
Okay so, unless you live under a rock, the news this week has been amazing. Facebook announces Libra under much criticism.
The announcement had a few effects:
Whether you love it or hate it, it has helped bring crypto into the spotlight this week. All press is good press for crypto, that much is true.
Regulators have sprung into action. Already making statements about the regulation of Libra and crypto in general. (See quotes below)
There are plenty of other quotes, but i think this suffices.
A final effect is that banks will be looking for an alternative or an edge against their competitors. Ripple and Xrapid already exist and has gone through extensive trials over the past 5 years.
Brad Garlinghouse has already made the statement that Ripple has has a "record week" due to the Libra Announcement:
BOOM- Thank you, Facebook.
Ripple is also in the spotlight for the Moneygram Deal. MoneyGram's Stock rose over 150% and huge announcements for new corridors were made as moneygram is expanding their footprint in India.
Ripple is making other moves as SBI Remit and SCB Thailand are featured in their Paying Forward promo videos (check twitter, i'm too lazy at this point to embed them lol)
TLDR: Banks are hurting from the potential FED rate drop and crypto appears this week to banks as a way to cut costs.
The financial transformation is on the horizon and is approaching fast!
If your read all that, congratulations. You're amazing!