Ripple mentions that the Private Ledger will ensure secured and fast transactions at low-costs.
Payment protocol Ripple is piloting a private version of the public and open-source XRP ledger for the issuance of central bank digital currencies (CBDCs). The payment protocol announced its plans to pilot the private XRP ledger to service central banks on the issuance and management of digital currencies in a blog post on the 3rd of March.
Over time, several central banks have been working on creating central bank digital currencies. Ripple noted in the announcement that 80% of central banks are actively exploring the creation of CBDCs. Some banks have already issued their digital currencies to citizens for testing.
Recently, central banks for China, Thailand, United Arab Emirates, and Hong Kong came together to explore a digital currency cross-border payment project.
Ripple Private Ledger for CBDCs
In Ripple’s announcement, the payment protocol said the same blockchain that powers its public XRP Ledger (XRPL) would also power the CBDC Private Ledger. As stated in the announcement, most ledgers are not built for payments. Hence, they may not be able to handle the required volume of transactions of a CBDC.
Stating its reason for piloting a Private Ledger for CBDC, Ripple said:
“Most blockchains are public ledgers, visible to all and updated by a broad network of validators. A Central Bank requires more transaction privacy and control over its currency than a public ledger can offer, so will most likely opt to create a CBDC on a Private Ledger that can also operate at the required scale.”
In addition, Ripple stated interoperability as one of the features of Private Ledger. The company said the Private Ledger would be able to connect with existing financial infrastructure globally. Ripple also said the Private Ledger would be able to synchronize with other CBDCs and other digital currencies. Already, the Bank of International Settlements (BIS) identified that interoperability for cross-border payments is a concern. The BIS said interoperability is a major priority for CBDCs. The BIS expressed its concern in its 2021/22 innovation program.
Ripple’s Private Ledger to Ensure Cost-Effective Transactions
Furthermore, Ripple mentioned other advantages of the CBDC Private Ledger. The payments protocol said that the Private Ledger will ensure secured and fast transactions at low-costs. The Ledger would also be able to handle the volume of transactions required by Central Banks. Ripple said the CBDC Private Ledger will handle tens of thousands of transactions per second. This is against the initial hundreds of thousands of transactions per second.
“The CBDC Private Ledger meets even the highest of security standards for Central Banks with each having complete sovereignty and ability to customize based on their own unique privacy and policy requirements. “
Stating further, Ripple said the main technology backing the new CBDC Private Ledger has been operating for over 8 years with no hitch. Additionally, the technology has conducted “billions of dollars of value transacted everyday.”
Court Orders SEC to Answer Ripple’s Interrogatories
Ripple, however, has failed to bury the SEC in paperwork, with the judge granting the agency’s motion for a protection order against “unduly burdensome” requests
Magistrate Judge Sarah Netburn has ordered the U.S. Securities and Exchange Commission to answer some of Ripple’s hotly-contested interrogatories, which are meant to determine whether or not the plaintiff’s contentions can be supported by facts.
The agency will have to specify why the company’s XRP sales are investment contracts:
The SEC’s legal theory is not an excuse to avoid responding to Defendants’ factual inquiry. Nor is it a basis to answer a different question than posed.
In addition, the SEC will have to state whether it believes that Ripple’s efforts were key to boosting the price of XRP.
However, Ripple’s interrogatory about whether or not the XRP Ledger was fully functional prior to the start of the securities offering has been denied for being too vague:
The Court agrees that this interrogatory seeks relevant information. But Defendants’ interrogatory is too vague for the reasons identified by the SEC.
Netburn has also granted the SEC’s motion for a protective order, which allows the regulator not to respond to all of Ripple’s “unreasonably burdensome” interrogatories.
The agency claimed that covering all the 29,947 requests would take 104 days without “breaks or sleep.”
Earlier this week, the court also granted the SEC’s motion to extend the expert discovery deadline to Jan. 14, 2022, despite Ripple’s protestations.
Ripple CEO Says the SEC Helped Ethereum to Surpass XRP as No.2 Crypto
- Ripple CEO aired his opinion on the crypto market and regulations.
- Brad Garlinghouse said the US SEC granted Ethereum regulatory green light.
At the DC Fintech Week virtual conference on October 21, Ripple CEO Brad Garlinghounse aired his thoughts on the state of the crypto market and regulations. Besides, he holds a grudge over the financial regulator’s approach to Ethereum.
In addition, Garlinghouse declared that the US Security and Exchange Commission (SEC) granted Ethereum regulatory green light that enabled it to surpass his firm’s XRP token.
Likewise, the Ripple boss feels that his firm has been played out. But, at the same time, Ethereum’s subsequent success is at least in part down to more favorable treatment by the US SEC. Also, Garlinghouse stated that it is affecting its market. He said,
“Within the last few years, XRP was the second most valuable digital asset. As it became clear the SEC had given a hall pass to ETH, ETH obviously has exploded, and that clarity has helped.”
To clarify, XRP was the second-largest crypto asset by market cap in late December 2017. But, currently, it has dropped to seventh place while Ethereum has kept the second spot ever since.
Furthermore, the reason why XRP dropped is the US SEC pursuing Ripple over claims that XRP is unregistered security. In fact, in January, Ripple filed a Freedom of Information Act request with the US SEC demanding to know why it didn’t consider ETH security.
As a result, later in July, a district judge allowed the firm to depose a former official who declared in 2018 that ETH was not a security.
Ripple CEO reinstates SEC bias towards ETH, claiming XRP could’ve been No.2
It is not news that the ongoing XRP lawsuit has got the better of Ripple’s XRP token. Ripple CEO, Brad Garlinghouse recently questioned the SEC’s bias towards Ethereum, claiming that XRP would’ve been at the No. 2 position instead of ETH if it weren’t for the commission’s partial crackdown. Garlinghouse spoke at the DC Fintech Week virtual conference yesterday, arguing that the U.S. Securities and Exchange Commission alleged Ripple’s XRP as unregistered security while granting Ethereum a regulatory free pass, which in turn helped ETH shoot through the roof.
“Within the last few years, XRP was the second most valuable digital asset. As it became clear the SEC had given a hall pass to ETH, ETH obviously has kind of exploded and that clarity has helped.”
XRP secured the position of the second-largest crypto asset by market capitalization during the latter half of 2017. However, the token has dropped down to seventh place while Ethereum stands strong as No. 2. Furthermore, Garlinghouse claims that the SEC’s exclusively aggressive anti-crypto stance to allegedly protect the consumers is in fact anti-investors. Referring to the XRP lawsuit, Ripple CEO emphasizes that “nearly 50,000 U.S. people who hold XRP who are trying to sue the SEC for ‘protecting them’”.
XRP Holders left with bearish and frozen funds
Earlier this week, Attorney Deaton Filed a Letter Motion on behalf of the XRP Holders (Movants) that contended SEC’s extension request, with the main argument concerning the XRP holders’ frozen funds because of the consistent postponement of the lawsuit’s final verdict. During the ongoing bull run, XRP remains considerably bear because of the regulatory crackdown on Ripple. However, the court has overlooked the community’s concern and granted the extension explaining that in lieu of pending motions, extra time will only facilitate both parties to complete pending fact discovery and thoroughly prepare for upcoming expert depositions.
“The lack of liquidity within the United States, coupled with the mass de-listings prevents XRP Holders from trading, selling, transferring, or converting their XRP. It is because of this de facto in place seizure of their property that XRP Holders took the extraordinary step to seek intervention as defendants… Any delay in the underlying action marks yet another day XRP Holders do not have access to their funds.”, wrote Deaton.