XRP and XRapid

[RippleMann]

Hey guys. So I'm trying to wrap my head around something. 

If a bank was to use XRapid to transfer money they would save on transfer fees but they would also be using the XRP token. Lets say Person A was going to transfer $100 to Person B. Would the $100 be converted to XRP based off of the price it's selling for? Like let's say XRP is trading at $1.50 at the time of the purchase. Does that mean the $100 is converted to XRP based off that trading price? So Person B actually  gets 66.66666 worth of XRP tokens? ($100/$1.50)

Also if that's the case, what if the price drops a little during the transfer? Does Person B not get the same amount of money anymore?

 

[jcdenton]

Welcome RippleMann. The 66.66 XRP are sent to the recipient's country and converted to his local currency there. He receives the money in his local currency. 

If the price drops during transfer, yes it would affect xRapid specifically because it does not use atomic payments like Ripple's other solutions.

However, over a large number of payments, the result for the the payment provider that offers xRapid could be net-neutral, so it would be easy for them to stand for the full amount. They would take a little if the price rises and add a little if it falls, so that the recipient gets the amount that was promised. 

[Guest]

Also for the early users of XRapid, and until the liquidity and volatility improve, Ripple have an incentive program where they provide incentives in the form of XRP for early adopters.  So the small risk of loss is more than compensated.  

Also the time span is very short.  4 seconds or so.  

Lastly,  the risk (and reward) can be borne by liquidity provider businesses in the future.   

[ZX81_1k]

It's worth remembering this already happens in the existing money transfer system (which takes days) as currency values fluctuate.