Ripple’s Real-Time Settlement Tech Gets Recognition by US Consumer Financial Protection Bureau
Ripple (XRP), which is a real-time gross settlement system and currency exchange network known for its use in cross-border payments was recently mentioned in an official US CFPB document. Most of the content in this document was based on changes and the future of remittance markets.
This is the first time in its existence that the 3rd largest cryptocurrency, in an official US document referenced the exchange. Ripple’s tech is an enabling real-time global payments system based on the blockchain network. The firm has invested in a number of small and medium sized businesses, mostly focusing on improving computer communication and exchange of information between blockchain platforms and Decentralized finance (DeFi) space.
The Consumer Financial Protection Bureau, (CFPB) which is an independent US agency, has since suggested a more accommodative approach regarding their settlement rule. For organizations that generate a defined amount in transfers for money each year, compliance costs are to be reduced. However, the document mentions that the rise and fast adoption of digital technologies offered by cross-border payment providers has brought about substantial changes in the remittance market. Such technologies are like Ripple, SWIFT Global Payment Innovation (SWIFT GPI) and non-bank financial companies.
In the document, the Consumer Financial Protection Bureau mentions that the adoption of Ripple’s XRP will go hand in hand with banks. It will be possible for banks to see the total of their transmission that will be collected by recipients prior to the transaction. For XRP and the crypto industry at large, this new system represents a major milestone in their overall service delivery. The Consumer Financial Protection Bureau, however, maintains that this new change might not take over by wave but will take some time before it is fully running.
The CFPB understands that however much the crypto industry is gaining mass adoption and popularity, it is very much unlikely that they will replace the traditional banking systems anytime soon.