Why liquidity of XRP in Mexico is surging after MoneyGram partnership

According to an analyst based in Japan, the liquidity of XRP in Mexico, specifically on Bitso, has increased significantly following the partnership between MoneyGram and Ripple.

Prior to the deal, the Tenitoshi Liquidity Index for XRP in Mexico was hovering in the negative, indicating that the volume of the cryptocurrency struggled to recover.

In June 2019, Ripple established a strategic partnership with MoneyGram, a major remittance service provider, to utilize XRP in processing international payments.

As a part of the deal, Ripple pledged to invest up to $50 million in the remittance company, anticipating that the partnership would increase the usage of the asset and the XRP Ledger as a settlement layer.

Ripple sees MoneyGram as a big catalyst for XRP. In August, Garlinghouse emphasized that MoneyGram will start using XRP to process Mexican peso and Phillippine peso pairings, and the increase in volume will likely be reflected starting the first quarter of 2020.

So far into the year, heading into 2020, the usage of XRP in Mexico, fueled by the MoneyGram-Ripple partnership, is noticeably on the rise and if the trend can be sustained until the year's end, the volume is expected to rise further entering into the first quarter of next year.

Eric Dadoun, an early stage investor, expressed optimism towards the increase in the usage of XRP, adding that half of the supply of the cryptocurrency being in escrow by Swell 2019, is an important milestone.

"Less than half the total supply of XRP will be left in escrow just in time for Swell By Ripple. Whether you call it a coincidence, conveniently timed or baseless speculation, one thing is for sure it's a milestone. Onwards."

Although the price of XRP has dropped by more than 91 percent from its all-time high, in the past month, the asset has increased from around $0.23 to $0.29, by more than 26 percent against the U.S. dollar.

Technical analysts and traders like Peter Brandt said earlier this month that there are signs that XRP is close to reaching key support levels against BTC, entertaining the possibility of a recovery period.