Bhutan to pilot digital currency with Ripple technology
Bhutan’s central bank is to use Ripple’s private ledger CBDC to pilot a central bank digital currency.
Building on its current payment infrastructure, the Royal Monetary Authority will pilot retail, cross-border and wholesale payment use cases for a phased digital Ngultrum using Ripple’s blockchain technology.
“Our collaboration with Ripple is a testament to the potential of CBDCs to provide an alternative and sustainable digital payment instrument in Bhutan,” said Yangchen Tshogyel, deputy governor of the Royal Monetary Authority of Bhutan. “Ripple’s breakthrough technology will allow a CBDC to experiment with our existing payment infrastructure, while ensuring efficient and cost-effective cross-border transfers.”
The latest move follows the launch in 2019 of Bhutan’s Global Exchange for Financial Transactions (Gift), which enables the electronic transfer of high value and bulk payments.
Ripple began testing a private version of its public and open source XRP ledger for central bank-backed digital currency issuance in March.
The company says its CBDC private ledger will be able to handle tens of thousands of transactions per second (TPS) initially, with the potential to scale up to hundreds of thousands of TPS over time.
The company also touts the use of its internal cryptocurrency XRP as a neutral bridge asset for frictionless value movement between CBDCs and other currencies.