Central Bank of Saudi Arabia And Western Union To Use Ripple Blockchain Technology
Blockchain based payment protocol XRP, the native token of Ripple underwent a major price hike in early January 2018 when its price per unit climbed up to $3 only to stabilize at a little over $1 per unit by the middle of January. This however helped Ripple in reaching almost 50% of Bitcoin’s market capitalization causing it to stumble across new takers who are actually favouring it over the market leader Bitcoin.
Let’s take a look at two such recent happenings which houses the potential of increasing the spread of Ripple in days to come as it proceeds in the path of gaining the top slot in crypto battle.
Ripple’s Blockchain Technology Empowers Saudi Arabia’s Central Bank
A deal has been signed in between the US-based Ripple and the Saudi Arabian central bank for helping indigenous banks in settling payment transactions by making use of Ripple’s Blockchain technology.
This development comes at a time when Gulf regulators are slowly opening up to the unexplored regions of financial technology. This pilot programme to be roll forwarded by the country’s central bank shall allow local banks to instantly settle payments both within and outside domestic borders powered by Ripple’s Blockchain Architecture.
Ripple revealed on Wednesday that this will help the Saudi Arabia’s banks in bringing upon cheaper, faster and more transparent cross-border remittances. However, required training shall first be provided by the central banker to the interested financial bodies trying to incorporate the programme in their existing architecture. It is imperative to note that the Saudi Arabia’s Central Bank had warned citizens against cryptocurrency trading last year since it was outside its regulatory radar.
Most of the Gulf regulators had also been extremely wary about the application of fintech in hard-core financial sector. Bahrain however has been extremely inquisitive about this new trend of digital currencies for boosting up its role as a regional financial hub. This has nudged an array of regulators belonging to larger Gulf economies in following suit.
Mubarak Rashed al-Mansouri, the UAE central bank governor revealed to Reuters in December that the central bank of Saudi Arabia is working in collaboration with United Arab Emirates central bank for fostering the issuance of a digital currency which can facilitate cross-border transactions between both the nations. The regulator of Abu Dhabi’s international financial centre announced earlier this week that rules binding the handling of virtual currencies in exchanges was already in the process of being created. Abu Dhabi also released regulations for ICO some time back.
Western Union Confirms Testing Ripple Blockchain Technology For Funds Transfer
Raj Agrawal, the Chief Financial Official of financial services provider Western Union recently revealed to Bloomberg during an interview held on 14th February that the company is running tests on transactions by making use of Ripple’s Blockchain based settlement system.
This announcement came after a month of speculation hinting at the company making use of the same. This globally known money transfer agent earned a revenue of $1.4 billion in 2017 which came as a 5% hike over its previous fiscal’s result.
Brad Garlinghouse, the CEO of Ripple announced to Bloomberg that Western Union shall be looking at their platform for facilitating money transfers, especially the ones surpassing demographic borders.
Garlinghouse validated his stand by saying that Ripple transactions are :
“A thousand times faster and a thousand times cheaper than Bitcoin’s.”
Hikmet Ersek, the Chief Executive Officer of Western Union also confirmed the testing during a conference held on 13th Feb by stating that:
“We are looking especially in the processing settlement and working capital optimization, also in the regulation part, on the compliance part on the blockchain capabilities, and that “we do have some tests with Ripple.”
At the time of publishing this article, the price of Ripple’s XRP token was $1.12. Though no major increase in price has been observed till now, as Ripple is making huge collaborations on regular basis, we can expect price of Ripple to shoot up anytime in coming weeks.
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Rohit Kukreja is a Commerce graduate with Financial Markets expertise involving Stocks, Forex, Futures & Options Market and now Bitcoins & Cryptocurrency Markets. Blockchain Enthusiast but not a techie, Rohit is an active member of various Blockchain & Crypto communities all over India.