MasterCard Partners With Ripple And Six Others For Its CBDC Project
According to the latest report, a giant online payment platform, Mastercard, has released a list of crypto companies it would be working with to issue its native central bank digital currency, with Ripple Labs topping the list.
In November 2021, the Mastercard payment platform revealed its intentions to venture into the CBDC ecosystem sometime in the future. However, it seems the envisaged future is here as the international payment firm announced its official venture to explore the CBDC space together with some giant firms in crypto, including Ripple, Consensys, Fireblocks, and four others.
Mastercard has just made an exciting announcement, including Ripple, Fireblocks, Consensys, and four others in a new CBDC Partner Program. The program aims to “bring a greater understanding of the benefits and limitations of CBDCs and how to implement them in a way that is safe, seamless, and useful,” according to Mastercard.
In its public announcement, Mastercard shared little details on the purpose of the new CBDC research program it launched. However, the Bank of International Settlement (BIS) believed Mastercard’s CBDC project had the same purpose as those established by other financial firms in the past.
According to the BIS, several central banks worldwide are currently exploring the use case of CBDC, while quite a number of them are already at an advanced level of launching a pilot test for their CBDC. With the rapid growth rate of retail CBDCs, the BIS opined that there could be about 9 wholesale and 15 retail CBDCs in circulation by 2030.
Ripple’s Venture Into CBDC Ecosystem Grows Stronger
According to the report, Ripple’s presence in the team was a result of recent efforts the firm has been making in the CBDC ecosystem. Reports revealed that Ripple aided Palau with its dollar-pegged stablecoin, helping Hong Kong, Colombia, Bhutan, and Montenegro to develop their central bank digital currencies.
Furthermore, Ripple has successfully presented itself as a global forerunner in the CBDC and digital currency initiatives by launching its CBDC platform, which uses the same XRP Ledger-based technology as Ripple’s native token, XRP. It plans to offer a secure, stable, robust network integrated with interoperability and sustainability.
Commenting on Ripple’s CBDC platform, the deputy governor of Bhutan’s Royal Monetary Authority, Yangchen Tshogyel, stated that the platform enabled them to explore the CBDC within their contemporary payment system while improving the efficiency and cost-effectiveness of international transactions.
Also, a giant software firm, Consensys, and Fireblocks, which is a digital assets firm, and Fluency, a multi-CBDC and asset technology provider, have executed several projects on central bank digital currencies alongside Ripple Labs. Many of these CBDCs solutions allowed secured offline and online payments which are supposedly crucial for the global adoption accessibility of CBDC.
Entities Worry Over Poor Privacy Nature Of CBDC
However, despite the rapid growth and adoption of the CBDC, many nations and entities are still skeptical about the innovation due to its poor user privacy nature, which is a big deal. Ajdenbaum Jerome, an executive at Idemia, an identity and payment firm, stated that users treat their privacy as a top priority, as the number one topic. He added that it is very vital for firms to protect customers’ privacy as promised.
According to reports, Idemia, together with the Bank of England, recently explored the protocols for protecting customers’ privacy while making sure no fraudulent activity occurs. Idemia aimed to execute its plan using a safe offline CBDC wallet that enables secured swapping of digital currency for CBDCs.
In addition, this process would allow customers to make multiple payments offline via means that manage balance, store keys, process biometric authentication, and validate transactions through hardware chips for optimal security.
Although the partnership offers many promising potentials for invention and development, it is yet uncertain if customers would adopt retail CBDC. Meanwhile, in China, the report showed that about 250 million citizens have utilized the digital yuan. Other coup treaties with active CBDC in circulation include the Bahamas and Nigeria. In addition, Guardtime, a crypto analytic firm, suggested that about 64% of the world would utilize CBDCs.
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