The central bank of Bhutan is to use Ripple's CBDC Private Ledger to pilot a central bank digital currency.
Building atop its current payments infrastructure, the Royal Monetary Authority will pilot retail, cross-border and wholesale payment use cases for a digital Ngultrum in phases using Ripple’s blockchain technology.
“Our collaboration with Ripple is testament to the potential of CBDCs to provide an alternative and sustainable digital payment instrument in Bhutan,” says Yangchen Tshogyel, deputy governor of the Royal Monetary Authority of Bhutan. “Ripple’s groundbreaking technology will allow for the experimentation of a CBDC with our existing payments infrastructure—while ensuring efficient and cost-effective cross-border transfers.”
The latest initiative follows the 2019 launch of Bhutan's Global Interchange for Financial Transactions (Gift) system which enables electronic transfer of large value and bulk payments.
Ripple began testing a private version of its public, open-source XRP Ledger for central bank-backed digital currency issuance in March
The firm claims that its CBDC Private Ledger will be capable of handling tens of thousands of transactions per second (TPS) initially, with the potential to scale to hundreds of thousands TPSs over time.
The firm is also touting the use of its inhouse cryptocurrency XRP as a neutral bridge asset for frictionless value movement between CBDCs and other currencies.