It seems that Ripple, the company behind XRP and the XRP Ledger, is currently focusing on the development of so-called Central Bank Digital Currencies (CBDCs) and similar applications. For the development of those private blockchains, it uses the computer code of the XRP Ledger (XRPL) for central banks that want to build a CBDC.
Still in development
If we are to believe Matt Hamilton, a former employee of Ripple, the company is indeed working on private versions of the XRP Ledger for CBDCs. However, as far as he knows, these are not yet live and the company is still working on the code.
“Besides that, the only place XRP really exists is on the XRP Ledger,” said Hamilton. Apparently people were concerned about the creation of additional XRP on another blockchain by the launch of this computer code.
Hamilton’s message is in line with an official message from Ripple from 2021 (see the tweet above). Monica Long, the president of Ripple, confirmed in that message that it is working on CBDCs.
What is a CBDC?
We hear more and more about CBDCs, but there are probably very few people who know exactly what it is about. Basically, a CBDC is a digital version of a government coin.
In principle, this digital version gives the central bank more control over the financial system. For example, they can give people personal interest rates to stimulate consumption or to achieve the opposite.
If inflation is high, central banks can, for example, offer a high interest rate on savings in order to keep consumption in check. It is therefore mainly a tool for central banks to gain more control over the economy.