Financial Giant SBI Acknowledges Ripple's Potential in Business Report

SBI Group, a Tokyo-based financial services firm that launched the first bank-owned crypto exchange last year, published its latest financial report in which it noted that American fintech, Ripple Labs’ products have the potential to improve the international payments system.

Covering a nine-month period ending on December 31st, 2018, SBI Group’s financial outlook report provided an overview of the products developed by San Francisco-based Ripple Labs. The giant holding company’s report also covered blockchain consortium, R3’s line of products - as SBI’s management believes these core solutions will improve trade finance and help expedite international payments.

In the section called “Business Area Separation of Ripple and R3,” SBI’s report mentioned that most of Ripple’s products have been developed to improve “international remittance.” Meanwhile, R3’s distributed ledger technology (DLT)-based solutions “are not limited to the financial industry” as they offer “smart contract-based technology”, the report stated.

Corda Settler, S Coin Platform To Help Expedite Transfers

SBI’s business strategy document further noted that XRP (a digital token that was developed by Ripple Labs) is the first cryptocurrency that was integrated into R3’s Corda Settler, which is “an application purpose-built to allow for payment obligations raised on the Corda blockchain platform to be made through any of the world’s payment systems, both traditional and blockchain-based.”

SBI’s extensive 155-page write-up also noted that its blockchain-enabled S coin platform (which the firm tested by conducting retail transactions in September 2018) would be used along with the Corda Settler - in order to expedite cross-border transfers.

In June 2018, the Japanese financial holding firm launched SBI Virtual Currencies. As part of its crypto exchange platform, SBI also began offering spot trading through a service called VCTRRADE. At that time, the bank’s platform only supported spot trading for XRP/Japanse Yen (JPY). Since then, VCTRADE has started accepting deposits for bitcoin (BTC) and ether (ETH).

SBI Holdings Acquires Stake In Clear Markets

In August 2018, SBI Group announced it would start offering cryptocurrency derivatives trading to institutional investors. In order introduce the new crypto trading option, SBI Holdings had acquired a 10% stake in Clear Markets, a US-based digital marketplace provider. At the time of deal, the Nikkei Asian Review had estimated the value SBI’s stake in Clear Markets to be around $9 million (1 billion JPY).

Mark Brickell, the CEO at Clear Markets, had revealed that SBI would also be offering a swap trading venue. Commenting on how Japan is one of the world’s most crypto trading markets (at that time), Brickell remarked:

As much as 50 per cent of cash trading in cryptocurrency has taken pace in Japan, so that is a nice place for us to start.

38% of Crypto Exchanges Interact With High-Risk Entities in 25% or More of Their Transactions

Leading cryptoasset data provider CryptoCompare has published an updated version of its cryptocurrency Exchange Benchmark. The report details that 38% of crypto exchanges interact with high-risk entities in 25% or more of their transactions.

According to CryptoCompare’s Exchange Benchmark, interactions with high-risk entities are considered when the cryptoasset data provider is raking exchanges. These interactions are measured according to CipherTrace’s Interaction Risk Score, which profiles transactional risk by “deanonymizing risky entities and illicit activities to identify criminal sources of funds and money laundering exposure.”

CryptoCompare then scores exchanges according to the percentage of transactions conducted with entities deemed high-risk. These include criminals, darknet markets and vendors, gambling projects, malware operators, cryptocurrency mixers, ransomware operators, and OFAC sanctions addresses.

The benchmark details that addresses with up to 25% of transactions conducted with these entities receive some points, but those above said mark receive none. Notably, 38% of cryptoasset exchanges were above it.

Data shared in the report detailed that Top-Tier cryptoasset exchanges, those graded AA to B in the report, interact less with these entities, while Lower-Tier exchanges, those rated C-E, interacted more. While both AA-related exchanges, Coinbase and Gemini, had no interactions with high-risk entities, some of the exchanges with A, BB, and B ratings did.

As CryptoGlobe reported, the Exchange Benchmark also revealed Top-Tier exchanges are gaining market share against Lower-Tier exchanges. It details that top-tier exchanges accounted for 32% of the global volumes in Q4 2019, while in the first quarter of this year they accounted for 36%.

In the second quarter of 2020, the Top-Tier exchanges already accounted for 40% of the global trading volume. In June these exchanges got to a 46% market share. Lower-Tier Exchanges, have seen their share of the space’s total trading volume drop from 68% to 60% in the last three quarters.

Featured image via Pixabay.