Uphold Will Not Use Customer Funds for Ripple Payments Transactions

  • Uphold announces its plans to purchase XRP on the open market for Ripple Payments transactions across borders.
  • Ripple recently announced its strategic partnership with Uphold for serving customers in the US.
  • The move intends to avoid using customer funds for the Ripple Payments transactions.

The global, multi-asset trading platform Uphold recently announced its decision to purchase Ripple’s XRP token on the open market for Ripple Payments (formerly known as On-Demand Liquidity) dealings.  The platform’s critical move further strengthens Uphold’s strategic partnership with Ripple Labs, which intends to offer Ripple Payments services to clients in the United States through Uphold.

The new update on Uphold’s partnership with Ripple came following a customer’s inquiry about the use of customer deposits in the transactions. Clarifying prevailing doubts, Uphold shared an X post, asserting, “We will, however, be using our expertise in sourcing both fiat and crypto (XRP included) on the open market, in order to facilitate the near instantaneous transfer of money across borders via Ripple ODL”.

According to Uphold’s new revelations, the platform envisions using the tokens accumulated from open markets for On-Demand Liquidity (ODL) transactions without tampering with customer funds. ODL is a payment system for real-time, cross-border transactions using XRP tokens.  The payment solution follows the system of converting a currency into XRP, transferring it across borders, and converting it back into the required currency at minimal time.

Earlier this month, Ripple announced its alliance with Uphold in an attempt to foster its global payments infrastructure. In a tweet dated October 24, Ripple stated,

“Our new partnership with Uphold enables us to enhance our underlying infrastructure and Uphold’s deep liquidity expertise further underpins Ripple’s ability to offer fast and flexible cross-border payments around the world.”

Uphold’s approach to the safety of customer funds is understood as one of the significant strategies adopted by the firm to avoid the risks connected to commingling customer funds with company assets. While the misappropriation of customer funds has been a major topic of discussion since the FTX debacle, exchanges like Uphold have been putting efforts into making dealings transparent.

Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.

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