Establishing an international remittance and micropayments system has been one of the European Central Bank’s top priorities for some time now. They even have a prototype network online already. The question for the crypto verse, and more importantly for Ripple is, will the EU give Ripple a chance to serve this network?
The European Commission recently held a session in Brussels. The idea is to support an existing initiative to develop a widely available cross-border instant payment system in the Euro Zone.
The event was hosted by the European Central Bank (among others), and it aims to find out what are the current obstacles in developing such a project successfully.
Only a few weeks ago, the very same ECU published a paper dubbed as “Crypto-Assets: Implications for financial stability, monetary policy, and payments and market infrastructures” in which it identified three digital assets (including Ripple’s XRP) as viable options because of their functionality, liquidity and business model.
The Bank’s paper
The paper was qualified as “occasional” because while it was written by one of the ECB’s research teams, it doesn’t represent the bank’s official position on the issue. It’s clear, however, that the bank wants to create an instant international payments system that’s cheap, easy to use, reliable, and that Ripple’s technology and cryptocurrency are among the leading candidates for adoption.
Ripple has already proven to the world at large that it’s blockchain network, software platforms, and cryptocurrency are viable solutions to the global payments problem Many banks around the world, including several based in Western Europe, are already Ripple Net members and are using those resources to move money all around the world. MoneyGram also adopted Ripple recently. So while Ripple is undoubtedly not the only option in the market, there’s every chance that it’s the best one among the viable ones.
It remains to be seen what the ECB will decide. Maybe they won’t be willing to put all its eggs into a single basket, especially when that basket is a US-based private company, which is out of their jurisdiction, even if it has the best solution in the market. That would put Ripple in charge of the ECB, so to speak, which would be a challenging position to defend from the political perspective.
But just being considered is a massive deal for Ripple. It lends them credibility and publicity at a different level. Of course, the company won’t settle just for being a candidate.
Since its inception, Ripple’s primary focus has been precisely in using blockchain technology and digital assets to settle international transfers. That’s why, unlike other digital coins, it’s never tried very hard to be a micropayments system, or a local currency such as Bitcoin, Litecoin, and most others.
The firm is concentrated on that problem, and it’s made more progress than any other company in the world in that regard. But will that be enough to persuade the ECB? Time will tell. But if Ripple’s leadership plays its cards right, it could secure this partnership, which would surely become the most important in its history.
Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.