The new platform is designed to enable governments, central banks, and financial institutions to issue their own digital currencies.
Ripple Labs, a Silicon Valley-based fintech company, has launched a central bank digital currency (CBDC) platform.
According to a press release today, the proprietary platform for CBDC will allow governments, central banks, and financial institutions to issue their own digital currencies.
Ripple’s CBDC Platform is an enhanced version of the company’s Private Ledger, which went live in 2021. Per the announcement, the Ripple CBDC Platform is powered by the XRP Ledger (XRPL).
With the new platform, government institutions can effectively manage the entire life cycle of fiat-based CBDCs, including minting, distribution, redemption, etc.
The platform will allow financial institutions to participate in inter-institutional settlements using digital currency. Furthermore, central banks can leverage the solution to develop retail and wholesale CBDCs.
Notably, the platform will enable both government and central banks to bring the next level of digitization to their financial services. Consequently, the initiative will allow millions of unbanked people globally to gain access to financial services.
Commenting on the development, VP of Central Bank Engagements & CBDCs James Wallis said the innovative capabilities of the platform would enable instant settlements for domestic and cross-border payments.
He added that the platform would mitigate the risks of sending and receiving digital currency on either side of a transaction.
“As a trusted partner to several central banks, we believe this platform will help solve problems for many central banks and governments who are devising plans and developing a technology strategy for CBDC Implementations,” said Walls.
It bears mentioning that the new CBDC platform’s capabilities will be demonstrated via the e-KHD pilot, a program run by the Hong Kong Monetary Authority (HKMA), the region’s de-facto central bank.
Ripple’s Contributions to CBDC Development
Ripple is one of the pioneers of CBDC development. Several central banks have partnered with Ripple on different CBDC pilot programs.
Some of these financial institutions include the central banks of Montenegro, Palau, Bhutan’s apex banks, etc.
Interestingly, Ripple’s efforts toward CBDC development have not gone unnoticed. Earlier this month, Ripple was ranked as an established leader for central bank digital currencies.
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