Ripple, provider Enterprise blockchain and encryption solutions For cross-border payments, today announced the cooperation with the Royal Monetary Authority (RMA) of the Central Bank of Bhutan to use Ripple’s CBDC Private Ledger to pilot the Central Bank Digital Currency (CBDC).
Based on its existing payment infrastructure, RMA will use Ripple’s sustainable blockchain technology to pilot digital Ngultrum’s retail, cross-border and wholesale payment use cases in phases. Doing so will help accelerate its mission of increasing Bhutan’s financial inclusion to 85% by 2023.
“Our collaboration with Ripple demonstrates the potential of CBDC to provide alternative and sustainable digital payment tools in Bhutan. Ripple’s technology will allow for the trial of CBDC on our existing payment infrastructure while ensuring cost-effective cross-border transfers .”
– Yangchen Tshogyel, Deputy Governor of RMA
RMA is committed to developing a secure and robust payment system, which makes it a leader in financial innovation. In 2019, the Central Bank launched the Global Financial Transaction Exchange (GIFT) system, which enables electronic transfers of large and batch payments. It also complements the government’s electronic public expenditure management system (e-PEMS) to simplify transactions with the government and the banking system.
As one of the only negative carbon emitters in the world, Bhutan, like Ripple, has made a commitment to sustainable development. The CBDC private ledger-based on the public open source XRP ledger-is carbon neutral and 120,000 times more efficient than the proof-of-work blockchain. In addition, the CBDC private ledger provides central banks such as RMA with the security, control, and flexibility needed to deploy CBDC strategies without affecting their financial stability and monetary policy goals.
“We are very pleased to work with RMA on its CBDC agenda and cultivate our shared values to create a more sustainable, accessible and financially inclusive reality. In addition to providing the full life cycle required by CBDC, Ripple’s solutions It also provides central banks with the superior features and interoperability required to implement global cross-border CBDC payments.”
– James Wallis, Vice President of Central Banking, Ripple
With Ripple’s CBDC private ledger, the central bank will be able to access the CBDC ledger network to achieve full settlement interoperability while ensuring currency and technical independence.
Royal Monetary Authority of Bhutan
The Royal Monetary Authority of Bhutan (RMA) was established by the 56th Session of the National Assembly in 1982 and is responsible for the management of the national currency, foreign exchange reserves and foreign exchange business.
The Authority plays the role of a government banker, holds most of the government deposits, and provides funds through licensing, supervision and supervision of Bhutan financial institutions.
With the promulgation of the RMA Act (2010), the status of RMA has been elevated to an autonomous central bank, with greater powers in its operating mode and decision-making process.