Amidst all the legal chaos Ripple is in, the blockchain payments company hasn’t slowed on its efforts to transition traditional banks into a blockchain and crypto-based infrastructure. The company recently announced that it has been testing a private version of its open-source XRP Ledger that will support central bank digital currencies (CBDCs).
According to a blog post from Ripple on March 3, the efforts come at a time when central banks all across the globe are working to develop various digital currency initiatives. Ripple states that this CBDC-focused version of its open ledger “provides Central Banks a secure, controlled and flexible solution for the issuance and management of digital currencies.”
“We are currently engaged with Central Banks around the world to better understand their goals and assess how the CBDC Private Ledger can help achieve them,” the blog stated.
“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.”
The announcement comes amidst the legal clash between Ripple and the United States Securities and Exchange Commission regarding the illegal sales of XRP tokens, which the SEC considers a Security, back in 2012.
The CBDC Trend
CBDCs are a hot topic in the banking sectors as it could be the key to how governments might regulate the cryptocurrency industry. Ripple isn’t the only firm looking to cement its position in a world where central banks go live with digital currency initiatives.
Last month, PayPal CEO Dan Schulman said in the company’s investor day call that the payments giant is gearing up to be “the digital wallet for global CBDCs.” He added:
“PayPal is a perfect complement to central banks and government to distribute those CBDC in a modern way so that more people can access the digital economy, and we think that is a focus area of this new business unit we have put together.”
The concept to support multiple CBDCs from different parts of the globe is also something China is eyeing. China’s Blockchain Service Network (BSN), the nation’s first blockchain alliance has also announced plans to develop a universal digital payment network (UDPN) that connects different public and private blockchains in its international network.