Ripple Labs, which facilitates payments in mainstream and virtual currencies, is creating a developer portal and supporting a new accelerator. Already its efforts have made it possible to connect the Ripple payment network to websites that run on Magento's e-commerce platform.
"The main thing here is really to show the developer community that they're going to be supported for the long term," says Chris Larsen, the serial financial services disruptor who heads Ripple.
Ripple provides an open-source payment platform that can accept any form of real or imaged currency including dollars, euros, bitcoins or bottlecaps. Ripple finds a path to connect the currency the consumer wishes to use and the currency the merchant accepts.
Developers can use the Ripple protocol to build confirmation and path-finding efficiencies, market-making initiatives and consumer and business-to-business products, Larsen says.
Ripple is also providing support to CrossCoin Ventures, which provides developers on the Ripple network with funding, mentoring, training and access to investors. Ripple does not have an ownership stake in CrossCoin, but the two organizations share office space and other resources. "We are committed to making it easier for developers to build on Ripple," Larsen says.
Mathijs Koenraadt, a developer who has been creating Magento plugins since 2010, used Ripple's tools to create the Ripple Wallet plugin that creates an invoice of payment for merchants connected to Ripple.
"If widely used, a system like Ripple would allow merchants to accept payments in any currency worldwide," says Koenraadt, who received a 400,000 XRP (ripple) bounty, which is just shy of $6,000, for creating the plugin.
Ripple rides on top of a distributed peer-to-peer network with its own math-based currency, similar to how Bitcoin operates. This process allows for near real-time settlement while keeping transaction fees low and guarding against chargebacks.
"Merchants' No. 1 frustration over online payments is the transaction fee," says Koenraadt. "Major players and credit card processors charge up to 4% of the total order price; they charge even more if currency conversion is required."
One merchant based in Spain is already taking advantage of Koenraadt's development.
Rita Zachari, an online luxury jewelry merchant, has begun using the Ripple Wallet for payments on some websites. Rita Zachari offers a 5% discount to consumers who pay with Ripple.
"To get more sales is our main objective," says Alexis Sirkia, co-founder of Rita Zachari, a family business. Currently, the company sells mostly to customers based in Germany and the U.K., but with Ripple it hopes to start selling to residents of the U.S. and other nations, he says.
"The whole thing came about after we wanted to start accepting Bitcoin," Sirkia says. "Bitcoin is complicated for accounting purposes and hard to get into to."
The Bitcoin ecosystem is becoming less technical, with the growth of online exchange and wallet platforms with simplified user interfaces. Many businesses, including BitPay, Coinbase and Circle Internet Financial are working to facilitate the process of accepting Bitcoin as a merchant.
But there are still opportunities for companies like Ripple to remove more friction.
"Ripple has a great user interface ahead of the competition," Koenraadt says. "Ripple actually promises to solve several issues at once: merchants can accept and convert payments in any currency, merchants can have low transaction fees and merchants can redirect users to the ripple.com hosted payment page. Although it's possible to run your own Ripple server, merchant-side, it's not a requirement like with most other cryptocurrencies."
Sirkia says the store also has to worry about chargebacks and fraud when dealing with conventional payment methods, a process Ripple mitigates. Most stolen credit cards come to their business from the U.S., he says, which makes it risky to accept that form of payment.
Rita Zachari also accepts PayPal and sells on Amazon.com. While Amazon.com protects merchants from chargebacks and fraud, the company charges a 25% fee for this service, Sirkia says.
Larsen announced the Ripple project at the end of 2012 and has since been partnering with companies that can provide gateways for the system. Ripple's staff has also expanded to 40 people, mostly technologists and developers.
Although Ripple was first touted as a competitor to Bitcoin, the company has incorporated Bitcoin as an option alongside its own Ripple currency through a partnership with BitStamp.net, a digital currency exchange based in Slovenia. In October, Ripple Labs began working with ZipZap Inc. and SnapSwap to allow users to fund accounts in-person or online.
"Ripple is an infrastructure play," says Larsen. "We might look quieter from a consumer point of view but we're very busy integrating with partners and meeting with institutions."