Ripple Is Developing a “Private Blockchain” for Central Banks
Ripple is developing a more restricted version of the XRP ledger network that will be made available to the public. This “Private Blockchain” will be designed for the use of central banks who are looking to develop their own digital currency.
The Bank of International Settlements (BIS) announce in January 2020 through its study that more than 80% of central banks around the globe are working on CBDC, also known as digital central bank money. And Ripple is looking into including some of these projects in the XRP Ledger. This is why they started developing a new product called CBDC Private Ledger, which will be based on the same foundations that the XRP Ledger (XRPL) uses.
Caption: Ripple is making a “private blockchain” based on the XRPL
Unlike public blockchains, such as Bitcoin, Ripple explains that the “Private Blockchain” in development will be better suited for central banks. As central banks are expected to ensure the confidentiality of transactions, there is a need for them to use a more secure blockchain.
CBDC Private Ledger can allegedly handle tens of thousands of transactions per second and can occur almost instantaneously at a very low cost and high reliability. Thus, Ripple cited an example of the XRP Ledger, claiming that it is 61,000 times more efficient than the usual Proof-of-Work (PoW) based blockchains.
Ripple’s call to central banks says that each central bank that uses the CBDC Private Ledger can make changes within the network within the bounds of its privacy standards and policies. It adds that the underlying technology behind the CBDC Private Ledger sees billions of dollars’ worth of transactions every day and has been running smoothly for almost a decade.
Notably, Ripple is currently facing a lawsuit filed by the United States Securities and Exchange Commission that alleges that the XRP was sold as an unregistered security in the last eight years. And most recently, the CEO of Ripple submitted a new document claiming that the SEC’s accusations were ungrounded an invalid.