In Brief:
- Ripple will develop USD-backed digital currency for the Republic of Palau.
- Ripple could be the complete first government-backed national stablecoin in the first half of 2022.
- Digital currency on the XRP ledger will be an alternative for the CBDC.
The digital payment network and cryptocurrency platform, Ripple, announced a partnership with the Republic of Palau to develop the digital currency for the Pacific island nation.
As a part of the deal, Ripple will initially monitor and guide the development of USD-backed digital currency to implement new strategies for cross-border payments. Also, Ripple added that the partnership “could see the implementation of the world’s first government-backed national stablecoin in the first half of 2022”
The Ripple also quoted that the development of digital currency will not be part of any Central Bank Digital Currency (CBDC).
“Ripple would provide Palau with technical, business, design, and policy support. Meanwhile, exploring a USD-backed stablecoin and associated use cases —such as a corporate registry— on the XRP Ledger could provide a viable alternative to central bank digital currencies (CBDCs) for countries like Palau”.
The Palau President is confident about digital currency and stated that it would “provide the citizens of Palau with greater financial access.”
As Palau is located on a Pacific island, the nation often faces natural disasters due to climate change, and owing to this the country opted for Ripple as its work on proof-of-stake, which is “carbon-neutral and 120,000X more energy-efficient than Proof-of-Work blockchains.”
“We are excited to be working with Palau to achieve its financial and climate-related goal,” said James Wallis, VP of Central Bank Engagements at Ripple.
“We have a wonderful opportunity to bring together our technology and experience with the unique characteristics of Palau to make a real economic and social impact for the country.”
Moreover, Ripple is working with Digital Pound Foundation in the United Kingdom to develop CBDC in the country.
