Ripple whitepaper recommends cryptocurrency XRP as CBDC intermediary

Thursday 25 March 2021 14:21 CET | News

Payment protocol Ripple has released a whitepaper document stating that the cryptocurrency XRP could act as an intermediary to connect different central bank digital currencies (CBDCs). 

The 14-page document is entitled ‘The Future of CBDCs’ and speaks of XRP as a neutral bridge that could bring speed and efficiency to the process of intermediating between different currencies. The document states that cross-border payments with CBDCs have so far been neglected by the central banks, and focus more on domestic use cases. According to Ripple, if the CBDCs interacted with each other, it would be easier for commercial companies to do international business. XRP is named as an example of a neutral bridge in this document, with which two different currencies can be bridged quickly and efficiently.

The US-based blockchain company PAC Global has also announced in a tweet that it would operate its own node to validate transactions on the XRP ledger. PAC Global is a partner in the Ripple-funded blockchain project Flare Networks. The XRP Ledger is operated by a Unique Node List (UNL) of trustworthy validators for processing transactions in the network, which keeps the fees comparatively low. More than 150 validators currently manage the ledger. While Ripple no longer runs the majority of them, the blockchain company is still releasing its own proposed UNL. 

To learn more about CBDCs, download our ebook Central Bank Digital Currencies for Beginners – A Quick Guide into CBDCs.

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Keywords: cryptocurrency, CBDC, blockchain, cross-border payments
Categories: DeFi & Crypto & Web3
Countries: World
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DeFi & Crypto & Web3

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