The global blockchain and cryptocurrency payments company recently announced that it is set to create a private version of the public open-source XRP Ledger. This decision is made to provide Central Banks with a secure, controlled, and flexible solution for managing and issuing digital currencies.
Ripple Labs Inc. operates Ripple as a real-time gross settlement system, currency exchange, and remittance network. Based in the US, the technology company first released its solution in 2012 with XRP as its native digital asset. It also supports tokens that reflect fiat, crypto, and commodities. The company is known for connecting disparate payment systems, utilizing blockchain technology to solve global payment challenges.
“We believe this solution will overcome the major challenges around creating and managing a sovereign digital currency, while amplifying the value and benefits for Central Banks, their partners and, above all, the millions of people who will use it,” said Ripple in its official announcement.
To date, a majority of Central Banks across various nations in around the globe are developing forms of sovereign-backed cryptocurrency. Through these Central Bank Digital Currency (CBDC) initiatives, opportunities to implement this technology are now open for everyone to participate in. Ripple’s initiative is aimed at helping Central Banks around the world to assess and achieve their economy-specific strategies.
Ripple is working to enable Central Banks to achieve settlement interoperability through a network of CBDC Ledgers. The company claims that it is working on such a solution where, with sovereign Central Banks operating digitally, the monetary and technological assets of each participating Central Bank will be respected as independent.
Leveraging XRP Ledger (XRPL) technology’s core consensus protocol, the CBDC Private Ledger can efficiently accommodate transactions at scale. Given how it is a strategic implementation of Ripple’s own technology, the CBDC Private Ledger is natively designed for issuing currencies, including all 5,400 currencies issued on XRPL, as well as Ripple’s native XRP functioning as a neutral bridge asset for frictionless value transfers at scale.
Current statistics for the orders of magnitude in which XRPL transaction are processed are claimed to be at 1,500 transactions per second (TPS) at a rate of 3.85 settlements per second. The suite of protocols for the also enable Interledger transactions to allow for high-throughput use cases.