The central bank will adopt Ripple’s CBDC Private Ledger to enhance financial inclusion and bolster digital payments
SAN FRANCISCO & THIMPHU, Bhutan–(BUSINESS WIRE)–Ripple, the leading provider of enterprise blockchain and crypto solutions for cross-border payments, today announced a collaboration with Bhutan’s central bank, the Royal Monetary Authority (RMA), to pilot a central bank digital currency (CBDC) using Ripple’s CBDC Private Ledger.
Building atop its current payments infrastructure, the RMA will pilot retail, cross-border and wholesale payment use cases for a digital Ngultrum in phases using Ripple’s sustainable blockchain technology. Doing so will help accelerate its mission to increase financial inclusion in Bhutan to 85% by 2023.
“Our collaboration with Ripple is testament to the potential of CBDCs to provide an alternative and sustainable digital payment instrument in Bhutan,” said Yangchen Tshogyel, deputy governor of the Royal Monetary Authority of Bhutan. “Ripple’s groundbreaking technology will allow for the experimentation of a CBDC with our existing payments infrastructure—while ensuring efficient and cost-effective cross-border transfers.”
The RMA’s commitment to developing a secure and robust payments system has cemented it as a leader in financial innovation. In 2019, the central bank launched the Global Interchange for Financial Transactions (GIFT) system which enables electronic transfer of large value and bulk payments. It also complements the government’s Electronic Public Expenditure Management System (e-PEMS) to streamline transactions between the government and banking systems.
In addition, Bhutan shares Ripple’s commitment to sustainability as the only carbon-negative country in the world. The CBDC Private Ledger—based on the public, open-source XRP Ledger—is carbon neutral and 120,000x more efficient than proof-of-work blockchains. What’s more, the CBDC Private Ledger provides central banks like RMA the security, control and flexibility needed to deploy a CBDC strategy without compromising its financial stability and monetary policy objectives.
“We couldn’t be more thrilled to partner with the RMA on its CBDC agenda and foster our shared values in creating a more sustainable, accessible, and financially inclusive reality,” said James Wallis, VP of Central Bank Engagements at Ripple. “In addition to providing the full lifecycle of CBDC requirements, Ripple’s solution offers central banks the superior functionality and interoperability needed to implement global cross-border CBDC payments.”
With Ripple’s CBDC Private Ledger, central banks will be able to access a network of CBDC Ledgers that enables full settlement interoperability, while ensuring monetary and technological independence.
For more information on the CBDC Private Ledger, visit Ripple Insights.
Royal Monetary Authority of Bhutan
The Royal Monetary Authority of Bhutan (RMA) was established in 1982 by the 56th session of the National Assembly to take over the issue of the national currency, the management of the external reserves and foreign exchange operations. The Authority assumes the role of government banker, holding the bulk of government deposits and providing finance through licensure, regulation and supervision of financial institutions of Bhutan.
With the enactment of the RMA Act (2010), the status of the RMA has been elevated to that of an autonomous Central Bank with greater powers in terms of its mode of functioning and decision-making process.
Ripple is doing for value what the internet did for information: enabling its instant and seamless flow around the world. We call this the Internet of Value (IoV). Using blockchain and cryptocurrency technology, Ripple is dedicated to creating powerful gains in financial efficiency, equity and inclusion. In addition, Ripple is developing and enabling the future use cases that will catalyze the new digital economy for governments, businesses and consumers.
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