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Ripple's $50 Million Investment in MoneyGram Is Fueling XRP Usage

DATE POSTED:December 1, 2019

The crypto world and traditional financial system are becoming more integrated every day.

This past week, cryptocurrency giant Ripple increased its equity stake in MoneyGram International (NASDAQ: MGI). Ripple initially invested $30 million in the money transfer company in June. On Nov. 25, Ripple announced that it was investing another $20 million, bringing its stake in MoneyGram to 9.95%. As part of the deal, Ripple also obtained warrants that give it the right to increase its stake to approximately 15% in the future. 

Notably, Ripple's latest stock purchase was made at $4.10 per share -- a sizable premium to MoneyGram's current market price near $3. Bulls would say that the purchase price suggests Ripple believes MoneyGram's stock is undervalued and has significant upside potential. Bears, however, would say that Ripple is paying a premium so MoneyGram will continue to use its XRP digital token in its cross border payment operations.

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