Ripple Wants to Help Central Banks Launch CBDC’s on A Private Ledger Running XRPL
Most countries are working on a central bank digital currency (CBDCs) these days. But, each nation is at different levels. Some are consulting, while others are exploring with partners and running pilots.
According to a Bank for International Settlements (BIS) survey, as many as 20% of central banks are actively exploring the idea of a state-sanctioned digital currency.
Ripple Wants To Help Banks Launch CBDCs
Blockchain giant Ripple Labs wants to gain a share of the rapidly-growing sovereign-backed digital currencies market, according to its latest announcement.
The company plans to launch a CBDC Private Ledger for central banks looking to launch digital currencies.
The CBDC Private Ledger will be hosted on the same blockchain that houses the XRP Ledger (XRPL). Using the private ledger, apex banks would be able to issue and maintain their currencies.
Ripple says the CBDC-focused payment solution will be cost-effective, reliable, and afford almost instantaneous response time, making it easy for banks to move money between CBDCs and other digital currencies.
Ripple claims its ledger would process thousands of transactions in mere seconds and will likely scale up to hundreds of thousands more in a few years. Since public blockchains are not ideal for large payments, Ripple sees its Private Ledger as the perfect product for central banks.
With the fact that most public blockchains operate a proof-of-work protocol and need validation before transactions are added to the blockchain, the CBDC private ledger will enable banks to confirm transactions on time. They can also customize the ledger according to their own particular needs.
Garlinghouse Sticks It To The SEC
Ripple boss Brad Garlinghouse is a busy man. Top on his mind has to be the lawsuit from the Securities and Exchange Commission (SEC). In a December injunction, Ripple and a number of its key executives were accused of selling unregulated securities by the government agency in 2013.
This has severely affected the digital currency company, which has seen its partnerships crumble and its digital token XRP delisted from major crypto exchanges worldwide. Another adverse effect has seen XRP fall from being the third most valuable crypto-asset by market cap to seventh within a few months.
Garlinghouse insists that the XRP token does not fall under the purview of a security and should not be categorized as one. He believes the financial watchdog has over-reached its regulatory powers with the case.