U.S. money transfer giant MoneyGram is testing the blockchain waters through a partnership with Ripple, the owner of the XRP digital currency.

The companies announced Thursday that MoneyGram will test XRP in payment flows through xRapid, Ripple’s on-demand liquidity service. They cited the low cost and speed of XRP transactions.

“XRP remains the most efficient digital asset for payments with transaction fees at just fractions of a penny, compared to Bitcoin fees of about $30 per transaction,” the companies said in a news release. “Similarly, the average transaction time for XRP is 2-3 seconds with other top digital assets ranging from 15 minutes to an hour.”

The value of XRP surged almost 15% to $2.22 on the announcement, according to Coinmarketcap data.
It had reached a record-high of $3.65 per coin earlier this month, briefly making it the world’s second-largest cryptocurrency by market value behind Bitcoin.

Skeptics have suggested XRP is unnecessary to carry out transactions but according to MIT Technology Review, “Ripple’s big bet is that XRP will become a ‘bridge currency’ that many financial institutions use to settle cross-border payments faster and more cheaply than they do now using global payment networks, which can be slow and involve multiple middlemen.”

“This notion of using digital currency as a form of bridge funding is not unique to XRP,” Fortune said, noting that last year, IBM and a consortium of banks in the South Pacific announced a blockchain transfer arrangement that uses a cryptocurrency called Stellar.

XRP’s recent spike has been linked to the news that 61 banks in Japan and two in South Korea have formed a coalition to launch a new Ripple pilot.

For MoneyGram, Fortune said, the partnership with Ripple “may provide a way to maintain its share of the money transfer market” amid competition from a new generation of low-cost Internet-based services like TransferWise.

“Ripple is at the forefront of blockchain technology and we look forward to piloting xRapid. We’re hopeful it will increase efficiency and improve services to MoneyGram’s customers,” MoneyGram CEO Alex Holmes said.

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