IMF praises Ripple and Circle, says banks will be ‘cannibalized’

31 Jan, 2019 | Updated: 31 Jan, 2019
by Joeri Cant
News
IMF praises Ripple and Circle, says banks will be ‘cannibalized’

International Monetary Fund (IMF) director Christine Lagarde praises Ripple’s and Circle's endeavors at the Paris Fintech Festival, where she warned banks that they  need to act and adapt to new technologies so they can better serve their customers.

International Monetary Fund director Christine Lagarde was part of a panel at the Paris Fintech Festival, where she stated that she believes that the difference between banking systems at large in many, many countries, will not be between those who are disrupted and those who survive. 

'The difference will be between those who are cannibalized because they’re not seeing it coming, and they’re not embracing it, and those who self-induce that cannibalization', she said.

'I’m using cannibalization on purpose because it’s a bit of a striking, horrible word. But it’s really what it means. You’re going to disrupt your business model. You’re going to change it. You’re going to reduce your costs. You’re going to expedite your transactions, and you’re going to inspire confidence because you will build out on the basis of an existing backbone, which is your bank and the confidence, relationship you’ve established with your customers.'

'That is where I see changes happening now. If you think of Circle, and Ripple and all those, that’s where they are active and helpful.'

Read more: XRP spikes nearly 10% after SWIFT partners with R3

Previously the Managing Director of the International Monetary Fund had said at the Fintech Festival in Singapore, that blockchain technology is 'safe, cheap, and potentially semi-anonymous, and that central banks could benefit from using cryptocurrencies as they might help supply money to the digital economy.

She added that all financial institutions should seriously consider exploring the feasibility of issuing their own virtual currency.

Read more: US Federal Reserve not interested in launching its own cryptocurrency

Just yesterday XRP saw an astronomical surge in a very short amount of time, spiking just under 10% in less than an hour.

The most likely explanation for this was the recent news that global services for financial payments provider SWIFT had decided to partner with blockchain firm R3, which uses XRP.

This latest endorsement from International Monetary Fund director Christine Lagarde might as well have contributed to the sudden surge of XRP.

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