Blockchain service provider Ripple has confirmed active collaborations with ten governments to work on Central Bank Digital Currencies (CBDCs). The cooperation aims to enhance the utility of the XRP ledger (XRPL) and foster the development of stablecoins.
According to Ripple’s CEO Brad Garlinghouse in a post, this initiative underscores Ripple’s commitment to advancing global financial inclusion by leveraging blockchain technology to create more efficient and accessible financial systems.
Ripple Focus on CBDC and Stablecoins
Notably, Ripple’s partnerships with these governments highlight the potential of the XRP ledger to serve as a robust platform for CBDC issuance and management. In addition to CBDCs, Ripple is focusing on stablecoins development, pegged to stable assets like the U.S. dollar.
The announcement has stirred reactions within the crypto community. A few users are considering the possibility that the speedy release of RLUSD is linked to the promotion of CBDCs. Another user has voiced worries about the impact of CBDCs on individual liberties, casting doubt on the excitement over what they perceive as a potential erosion of freedom.
Some other community members emphasized the pragmatic elements, underscoring the importance of a system facilitating secure and unrestricted value transfers, even without relying on the Internet.
Meanwhile, Ripple is also gearing up to introduce its stablecoin, Real USD (RLUSD). The stablecoin is designed to be linked directly to the US dollar, promoting stable and efficient transactions. The stablecoin will be available on the XRP ledger and Ethereum platforms.
Ripple Makes Advancements in the CBDC Space
Recall that in January 2023, Montenegro’s Prime Minister, Dr. Dritan Abazovic revealed that he discussed with some top executives at Ripple which was centered on developing an inclusive payment infrastructure for Montenegrins by leveraging Ripple’s technology.
Interestingly, the partnership continues Ripple’s expansion in the CBDC space. Despite its legal issues, the firm has numerous partnerships with various central banks for digital currency development. In late 2022, the Republic of Palau announced a partnership with the blockchain payment company to develop its stablecoin.
However, this is not the first time Palau has talked with Ripple about developing a digital currency, as the nation tapped the blockchain firm to establish the United States dollar-pegged digital currency to enhance cross-border payments in 2021.
Global CBDC Exploration Picks Up
Recently, a survey from the Bank of International Settlement (BIS) revealed a growing interest in CBDCs among central banks. The survey, which included participation from 86 banks, found that 94% are actively exploring the creation of digital versions of their national currencies. Notably, this figure represents a jump from 90% reported in a similar 2021 BIS survey.
As revealed in an earlier CoinRise report, Joachim Nagel, a European Central Bank (ECB) member, highlighted the importance of CBDCs to central banks. Nagel says CBDCs are an important tool to augment the traditional business model of central banks.
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