Tier 2 Partners - Emerging ODL Users

Pyypl launched the first ODL deployment in the Middle East, marking a significant geographic expansion.

Pyypl Profile:

PYYPL

Company Type: Digital financial services
Headquarters: Abu Dhabi, UAE
Founded: 2019
Business: Consumer payments, remittances
Licenses: Multiple MENA jurisdictions
ODL Status: Stage 4-5 (Production)

ODL Implementation:
├── First MENA ODL deployment
├── Consumer remittance focus
├── UAE → South Asia corridors
├── Expanding regional coverage
└── Real production volumes

Significance:
├── Proved ODL viability in MENA
├── Set regulatory precedent
├── Built regional infrastructure
└── Model for other MENA players

Pyypl Assessment:

Zand is the UAE's first fully digital bank, exploring ODL for cross-border capabilities.

Zand Bank Profile:

ZAND BANK

Company Type: Digital bank
Headquarters: Dubai, UAE
Founded: 2021
Business: Digital banking, B2B payments
Licenses: UAE Central Bank
ODL Status: Stage 3-4 (Pilot/Limited Production)

ODL Implementation:
├── Testing cross-border use cases
├── B2B focus (vs Pyypl's consumer)
├── Enterprise payments corridors
└── Early stage but progressing

Significance:
├── Bank (vs fintech) adoption
├── B2B use case development
├── UAE regulatory pathway
└── Different market segment

Zand Assessment:

Travelex Bank represents the most advanced ODL deployment in Latin America.

Travelex Bank Profile:

TRAVELEX BANK (BRAZIL)

Company Type: Bank (FX specialist)
Headquarters: São Paulo, Brazil
Business: Foreign exchange, international payments
Licenses: Brazilian Central Bank
ODL Status: Stage 4-5 (Production)

ODL Implementation:
├── Launched 2023
├── Multiple corridor focus
├── Growing volumes
├── Brazil ↔ International corridors
└── Ripple showcase for LATAM

Significance:
├── Proves ODL works in Brazil
├── Regulatory pathway established
├── Regional demonstration effect
├── Largest LATAM ODL user

Travelex Assessment:

Intermex operates ODL in the US-Mexico corridor, one of the world's largest remittance routes.

Intermex Profile:

INTERMEX (US)

Company Type: Remittance company
Headquarters: Miami, USA
Business: US → Mexico/LATAM remittances
Listed: NASDAQ (IMXI)
ODL Status: Stage 3-4 (Pilot/Limited Production)

ODL Implementation:
├── US → Mexico corridor
├── Largest remittance corridor globally
├── Testing/limited production
└── Regulatory navigation required

Significance:
├── US-based ODL implementation
├── Massive corridor potential ($60B+)
├── Post-SEC lawsuit opportunity
└── Public company (visibility)

Intermex Assessment:

Novatti is an Australian payments company with active ODL operations.

Novatti Profile:

NOVATTI GROUP (AUSTRALIA)

Company Type: Payments technology
Headquarters: Melbourne, Australia
Listed: ASX (NOV)
Business: Payment processing, remittances
ODL Status: Stage 4-5 (Production)

ODL Implementation:
├── Active ODL user since 2019
├── Multiple corridor access
├── Cross-border payments focus
└── Long-standing Ripple relationship

Significance:
├── Australian ODL presence
├── Public company (transparency)
├── Long operational history
└── Demonstrates developed market viability

Novatti Assessment:

Coins.ph is a Philippine crypto platform and key SBI Remit receiving partner.

Coins.ph Profile:

COINS.PH (PHILIPPINES)

Company Type: Crypto exchange / e-wallet
Headquarters: Manila, Philippines
Business: Crypto trading, payments
ODL Status: Stage 5 (Material Scale, as receiver)

ODL Role:
├── Primary receiving partner for SBI Remit
├── Converts XRP → PHP for recipients
├── Essential infrastructure component
└── Enables Japan → Philippines corridor

Significance:
├── Critical to SBI corridor success
├── Demonstrates receiving-side infrastructure
├── Philippine regulatory navigation
└── Model for other receiving markets

SCB has tested Ripple technology with some ODL experimentation.

SCB Profile:

SIAM COMMERCIAL BANK (THAILAND)

Company Type: Major Thai bank
Size: One of Thailand's largest banks
Business: Full-service banking
ODL Status: Stage 2-3 (Testing/Pilot)

ODL Implementation:
├── Testing Ripple technology
├── Some ODL pilot activity
├── Traditional bank conservatism
└── Potential for expansion

Significance:
├── Major bank testing ODL
├── Thai regulatory pathway
├── Conservative approach
└── Could scale significantly if committed

Aggregate Tier 2 ODL Volume:

TIER 2 VOLUME ESTIMATES (2024-2025)

Middle East:
├── Pyypl: $50-150M
├── Zand/Mamo/Other: $20-50M
└── Regional total: $70-200M

Latin America:
├── Travelex Bank: $50-150M
├── Intermex: $20-50M
├── Other LATAM: $10-30M
└── Regional total: $80-230M

Asia-Pacific (non-SBI/Tranglo):
├── Novatti: $30-80M
├── Various others: $20-50M
└── Regional total: $50-130M

Other Regions:
├── Various small players: $10-30M
└── Limited visibility

TOTAL TIER 2 ESTIMATE:
├── Conservative: $200-400M
├── Moderate: $300-500M
├── Optimistic: $400-600M
└── Share of global ODL: 15-25%

Tier 2 Growth Patterns:

TIER 2 GROWTH ANALYSIS

Historical Growth:
├── 2021: Few Tier 2 players, minimal volume
├── 2022: Emerging (Pyypl, Travelex launches)
├── 2023: Expansion ($100-200M aggregate)
├── 2024: Growth ($200-400M aggregate)
├── 2025: Acceleration ($300-500M aggregate)
└── Growth rate: 40-60% annually

Growth Drivers:
├── Geographic expansion (new regions)
├── Partner pipeline progression (Stage 2 → 3 → 4)
├── Corridor additions by existing partners
├── Infrastructure model (Tranglo) enabling access
└── Post-SEC regulatory clarity

Growth Barriers:
├── Each partner still faces integration challenges
├── Corridor economics must work
├── Regulatory environments vary
├── Competition from alternatives
└── Tier 1 conversion is rare

Which Tier 2 Partners Could Reach Tier 1?

TIER 1 PROMOTION CANDIDATES

High Probability (20-30%):
├── Travelex Bank Brazil: Strong commitment, favorable market
├── Pyypl: Regional leader, expanding
└── Requirements: Sustained growth, corridor expansion

Medium Probability (10-20%):
├── Intermex: Massive corridor potential, execution unclear
├── Zand Bank: Institution type, early stage
└── Requirements: Prove economics, scale operations

Low Probability (<10%):
├── Most other Tier 2 partners
├── Niche players, limited corridors
└── Requirements: Exceptional growth, market conditions

Timeline to Tier 1:
├── 3-5 years from Tier 2 establishment
├── Few will make it
├── Those that do provide meaningful diversification
└── Expected: 1-3 new Tier 1 partners by 2028-2030

Tier 2 adoption proves ODL can work beyond Asia-Pacific:

Geographic Proof Points:

Tier 2 partners demonstrate that different types of institutions can adopt:

Institution Type Diversity:

TIER 2 INSTITUTION TYPES

Banks:
├── Travelex Bank (Brazil)
├── Zand Bank (UAE)
├── RAKBANK (UAE)
└── Evidence: Banks can adopt ODL (not just fintechs)

Fintechs:
├── Pyypl (UAE)
├── Mamo (UAE)
├── Various others
└── Evidence: Fintechs natural early adopters

Remittance Companies:
├── Intermex (US)
├── Various via Tranglo
└── Evidence: Core use case institutions engaging

Payment Processors:
├── Novatti (Australia)
├── Various others
└── Evidence: Payment infrastructure companies adopting

Diversity Implication:
├── ODL not limited to one institution type
├── Multiple entry points to market
├── Broader applicability demonstrated
└── Different sales approaches can work

Tier 2 partners show consistent patterns with Tier 1:

Common Success Factors:

How Much Do Tier 2 Partners Reduce Concentration?

CONCENTRATION ANALYSIS

Without Tier 2:
├── SBI: 70-80% of ODL
├── Tranglo: 15-20%
├── Others: 5-10%
└── Extreme concentration

With Tier 2:
├── SBI: 50-60%
├── Tranglo: 15-20%
├── Tier 2 aggregate: 15-25%
├── Others: 5-10%
└── Still concentrated, but improving

Future with Tier 2 Growth:
├── SBI: 40-50%
├── Tranglo: 15-20%
├── Tier 2: 25-35%
├── Others: 5-10%
└── Meaningful diversification achieved

Assessment:
├── Tier 2 provides real diversification value
├── Concentration risk declining over time
├── Not eliminated, but improving
└── Geographic spread particularly valuable

Tier 2's Role in ODL Growth:

GROWTH CONTRIBUTION ANALYSIS

Current Contribution:
├── Tier 2 share: 15-25% of volume
├── Tier 2 growth rate: 40-60% annually
├── Tier 1 growth rate: 15-25% annually
└── Tier 2 growing faster (from smaller base)

2025-2027 Projection:
├── Tier 2 could reach 25-35% of volume
├── Absolute growth significant
├── Diversification benefit compounds
└── Some Tier 2 → Tier 1 promotions

Investment Implication:
├── Tier 2 growth is material to thesis
├── Not just SBI dependency anymore
├── Multiple growth vectors emerging
└── Monitor Tier 2 as leading indicator

What to Track in Tier 2:

TIER 2 MONITORING CHECKLIST

Volume Indicators:
├── Partner volume disclosures (when available)
├── Corridor activity estimates
├── Growth announcements
└── Production vs pilot stage

Stage Progression:
├── Testing → Pilot → Production → Scale
├── Corridor additions
├── Partner announcements
└── Investment/commitment signals

New Entrants:
├── New Tier 2 announcements
├── Geographic expansion
├── Institution type diversity
└── Pipeline building

Red Flags:
├── Partners going quiet
├── Stage regression
├── Competitive displacement
├── Regulatory setbacks

✅ ODL adoption is expanding geographically — Tier 2 partners in Middle East, Latin America, and other regions prove ODL viability beyond Asia-Pacific

✅ Multiple institution types can adopt ODL — Banks, fintechs, remittance companies, and payment processors all represented in Tier 2

✅ Tier 2 aggregate volume is material — Estimated 15-25% of global ODL, representing meaningful diversification from Tier 1 concentration

⚠️ Which Tier 2 partners will reach Tier 1 — High growth potential doesn't guarantee scale; most Tier 2 will remain Tier 2

⚠️ Exact Tier 2 volumes — Private companies with limited disclosure; estimates have wide ranges

⚠️ Sustainability of growth rates — 40-60% annual growth may not persist as bases grow

🔴 Overestimating near-term Tier 2 contribution — Even at 40-60% growth, Tier 2 is still smaller than Tier 1; don't assume rapid catch-up

🔴 Assuming all Tier 2 will succeed — Most won't reach Tier 1; some may fail or stall

🔴 Double-counting Tranglo partners — Some Tier 2 operate via Tranglo infrastructure; avoid adding overlapping estimates

Tier 2 partners represent meaningful progress in ODL adoption—geographic expansion, institution type diversity, and reduced concentration are all real. However, Tier 2 remains smaller than Tier 1, growth is from a small base, and not all Tier 2 partners will succeed. The investment thesis benefits from Tier 2 growth, but shouldn't overweight it relative to Tier 1 reality.

Assignment: Create a comprehensive tracking dashboard for Tier 2 ODL partners.

Requirements:

Part 1: Partner Profiles (35%)

Create detailed profiles for 10 Tier 2 partners:

• Company overview (business, headquarters, size)

• ODL implementation (corridors, stage, partners)

• Volume estimate (with methodology)

• Success factor scores (use SBI benchmark)

• Tier 1 promotion probability

• Monitoring priorities

• Pyypl (UAE)

• Travelex Bank (Brazil)

• Intermex (US)

• Novatti (Australia)

• Zand Bank (UAE)

• 5 additional Tier 2 partners of your choice

Part 2: Aggregate Analysis (25%)

• Total estimated volume (with range)
• Share of global ODL
• Geographic distribution
• Growth trajectory projection
• Diversification contribution

Part 3: Promotion Pipeline (20%)

• Rank all profiled partners by Tier 1 probability
• Document criteria used
• Estimate timeline for top candidates
• Identify what would accelerate/delay promotion

Part 4: Monitoring System (20%)

• Information sources for each partner
• Update frequency by partner importance
• Key indicators to track
• Triggers for reassessment

Grading Criteria:

Time investment: 5-6 hours
Value: This dashboard becomes your Tier 2 tracking foundation

1. Tier Definition Question:

What distinguishes a Tier 2 ODL partner from a Tier 1 partner?

A) Tier 2 partners are newer than Tier 1
B) Tier 2 partners are in production or advanced pilot with measurable but smaller volumes than Tier 1's material scale
C) Tier 2 partners only use RippleNet, not ODL
D) Tier 2 partners operate outside Asia

Correct Answer: B

Explanation: The tier distinction is primarily about scale and maturity. Tier 1 partners (SBI, Tranglo) operate at material scale with strategic depth. Tier 2 partners are in production or advanced pilot with real but smaller volumes—they're operational but haven't reached Tier 1 scale. Geography and age are correlated but not definitional; the key difference is volume and operational maturity.

2. Geographic Diversification Question:

What do Tier 2 ODL partners in UAE and Brazil prove about ODL adoption?

A) ODL only works in emerging markets
B) ODL can work beyond Asia-Pacific when regulatory clarity and corridor economics are favorable
C) All regions will have Tier 1 ODL partners soon
D) Western markets will never adopt ODL

Correct Answer: B

Explanation: Tier 2 partners like Pyypl (UAE) and Travelex Bank (Brazil) prove ODL viability is not limited to Japan/Southeast Asia. Both markets offer regulatory clarity (UAE/DIFC, Brazil's developing framework) and favorable corridor economics (high-cost traditional transfers). This demonstrates ODL can work wherever the enabling conditions exist—it's not a Japan-specific phenomenon.

3. Tier 1 Promotion Question:

Which Tier 2 partner has the highest probability of reaching Tier 1 (material scale), and why?

A) Novatti — longest ODL history
B) Travelex Bank Brazil — bank-level commitment, large market, favorable corridor economics, demonstrated growth
C) Intermex — largest corridor (US-Mexico)
D) Zand Bank — newest technology

Correct Answer: B

Explanation: Travelex Bank Brazil has the strongest Tier 1 promotion profile: bank-level institutional commitment, large and growing Brazilian market, favorable corridor economics for international transfers, and demonstrated operational growth since 2023 launch. While Intermex has access to a larger corridor (US-Mexico), US regulatory complexity and early stage make execution less certain. Novatti has history but limited scale. Zand is too early stage.

4. Aggregate Contribution Question:

Tier 2 partners are estimated to contribute 15-25% of global ODL volume. Why is this significant for XRP investors?

A) It proves ODL will dominate cross-border payments
B) It provides meaningful diversification from Tier 1 concentration, reducing dependency on SBI Holdings
C) It means Tier 2 is more important than Tier 1
D) It guarantees continued ODL growth

Correct Answer: B

Explanation: The significance is diversification. Without Tier 2, SBI alone represents 70-80% of ODL—extreme concentration risk. Tier 2's 15-25% contribution reduces SBI dependency to 50-60%. Geographic spread (UAE, Brazil, Australia) provides corridor diversification. This doesn't make Tier 2 more important than Tier 1 or guarantee growth, but it meaningfully reduces concentration risk.

5. Monitoring Priority Question:

An investor is tracking Tier 2 partners. Which metric would be the most valuable leading indicator of future Tier 1 promotion?

A) Press release frequency
B) Corridor additions and stage progression (pilot → production → scaling)
C) Social media mentions
D) Ripple partnership announcement count

Correct Answer: B

Explanation: Corridor additions and stage progression are operational indicators of actual growth. A partner adding corridors and moving from pilot to production to scaling demonstrates real commitment and success. Press releases are announcements (may not reflect reality), social mentions are noise, and partnership counts conflate RippleNet with ODL. Operational progression is the most reliable predictor of Tier 1 potential.

Partner-Specific Resources:

• Pyypl company materials and announcements
• Travelex Bank Brazil press releases
• Intermex investor relations (NASDAQ: IMXI)
• Novatti investor relations (ASX: NOV)
• Zand Bank announcements

Regional Analysis:

• UAE fintech regulatory landscape
• Brazil Central Bank digital payments initiatives
• LATAM remittance market research
• MENA cross-border payments analysis

For Next Lesson:

Lesson 10 examines RippleNet-only partners—the large institutions using Ripple's messaging technology without XRP. Understanding why they don't use ODL reveals adoption barriers and gateway potential.

End of Lesson 9

Total words: ~5,500
Estimated completion time: 55 minutes reading + 5-6 hours for deliverable