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(Kitco News) – The National Bank of Georgia (NBG) has selected Ripple Labs as its official technology partner for a pilot project exploring the creation of a digital lari, the country’s central bank digital currency (CBDC).
According to a press release from Ripple, “The partnership will see the National Bank of Georgia and Ripple jointly plan the execution and delivery of the pilot program using the Ripple CBDC Platform.”
Ripple’s CBDC technology will be used to evaluate the practical use cases of a digital lari to gauge potential benefits for the public sector, businesses, and retail users, the NBG said.
The NBG first announced its intentions to advance its CBDC project with the introduction of a limited-access live pilot environment in September. From there, it conducted a rigorous selection process that included nine shortlisted companies for evaluation. The bank assessed the applicants’ ability to support the pilot program and ultimately settled on Ripple Labs as their preferred technology partner.
“The decision was made by the committee comprising internal and external experts of the National Bank of Georgia following a competition process, which consisted of two phases: submission of a Project Execution Plan (PEP) by shortlisted candidates in the first phase, and demonstration of their technology solutions in the second,” NBG said. “The committee has paid attention to a depth of understanding of the project purposes and use cases, as well as full commitment to the project’s success, clear project development roadmap, consistent use cases, gradual deployment approach, and best practices of business continuity.”
Now that the selection phase is complete, NBG will advance to the pilot stage to test the Ripple CBDC platform in a live environment so they can evaluate select use cases, NBG said.
“We were pleased to select Ripple as the official technology partner for our digital lari (GEL) pilot project following a thorough review of all shortlisted parties,” said Natia Turnava, acting Governor of the NBG. “The committee selected Ripple due to its technical excellence and the expertise of its team. We look forward to moving ahead with Ripple and we are grateful to all other participating companies for their interest and efforts in the selection process.”
Ripple said they were selected because their CBDC Platform “stood out for its ability to provide a holistic end-to-end solution that enables central banks, financial institutions, and governments to seamlessly mint, manage, transact and redeem CBDCs.”
“The National Bank of Georgia is taking a global lead in exploring how it can use blockchain technology to take its economy into the digital era,” said James Wallis, VP of central bank engagements and CBDCs at Ripple. “By harnessing the power of the Ripple CBDC Platform, this pilot will pave the way for transformative advancements in the utilization of blockchain technology within the public sector.”
“Moving forward, the National Bank of Georgia and Ripple will now jointly plan the project execution and gradual rollout plan,” Ripple said.
XRP approved for use in Dubai
On Thursday, Ripple announced that the Dubai Financial Services Authority (DFSA) has approved the use of XRP within the Dubai International Financial Centre (DIFC), enabling licensed virtual asset firms within the DIFC to incorporate XRP into their virtual asset services.
“Since the DFSA opened up external applications, XRP is the first virtual asset to be approved by the regime,” Ripple said. “XRP joins BTC, ETH, and LTC as the assets previously approved under the DFSA’s virtual assets regime. XRP now stands to benefit from legal and regulatory clarity in the DIFC, and will be available for use by institutions located in the DIFC to accelerate faster, more efficient global value exchange.”
The UAE has emerged as one of the most welcoming jurisdictions when it comes to blockchain technology and digital assets, and has worked diligently to provide regulatory clarity and guidance to licensed firms that offer virtual asset services. They have developed a comprehensive regime for the DIFC designed to foster the long-term development of the crypto, payments, and fintech ecosystem within Dubai, as well as provide guidance for companies to set up shop in the free zone.
In 2022, Dubai also established its Virtual Assets Regulatory Authority (VARA) in an effort to protect investors, maintain high levels of risk assurance, and facilitate innovation. In February, VARA published its Virtual Assets and Related Activities Regulations 2023 guidelines, which set out a comprehensive Virtual Asset Framework built on principles of economic sustainability and cross-border financial security. Under the regulations, all crypto firms wishing to operate in Dubai must first obtain authorization and the relevant licenses.
“Dubai continues to demonstrate global leadership when it comes to the regulation of virtual assets and nurturing innovation,” said Brad Garlinghouse, CEO of Ripple. “It’s refreshing to see the DFSA encourage the adoption and use of digital assets such as XRP to position Dubai as a leading financial services hub intent on attracting foreign investment and accelerating economic growth. Ripple will continue to double down on its presence in Dubai, and we look forward to continuing to work closely with regulators to realize crypto’s full potential.”
Ripple said the listing of XRP in Dubai “has the potential to unlock new regional payments and other virtual asset use cases on the XRP Ledger.” In 2020, Ripple selected DIFC as the location for its MENA headquarters due to Dubai’s innovation-forward regulations, expansive network, and reputation as a leading global financial center. Approximately 20% of Ripple’s customers are based in MENA.
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