The mBridge project, a platform developed by central banks to facilitate real-time, cross-border payments, is undergoing a shift in its Consensus protocol. The project, which involves the participation of several countries such as Thailand, Hong Kong, China, and the UAE, aims to utilize wholesale central bank digital currencies (CBDC). The platform has gained attention from observers such as the central banks of Sweden and France, who may potentially join the alliance.
Initially, the mBridge project utilized a combination of technologies including Ethereum’s Solidity smart contract language and the Ethereum Virtual Machine. While some of these core technologies will still be utilized, the project is now transitioning to a new Chinese blockchain consensus protocol. This shift holds the potential to bring millions of users onto the platform, making it a direct competitor to SWIFT.
SWIFT, a global messaging network used by banks and financial institutions, allows for secure and efficient transfer of information. However, this network has often been subject to interference and has been used as a financial weapon by certain countries to exert control over others. The success of the mBridge project has the potential to significantly impact the international financial system and even influence political dynamics.
Additionally, the mBridge project aligns with the goals of the BRICS alliance (comprising China, Brazil, Russia, India, and South Africa) which aims to reduce the dominance of the US dollar as a global reserve currency. This alliance has been growing in popularity and has recently expanded to include six emerging market group countries. As the influence of BRICS continues to increase, the international financial landscape is likely to undergo further transformations.
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There has been speculation about whether the mBridge project will eventually switch to utilizing Ripple technologies, particularly its XRP Ledger. Ripple has already launched its own Central Bank Digital Currency (CBDC) platform, enabling financial institutions and governments to issue their own stablecoins and CBDCs. Currently, over eight countries are building their CBDCs on the XRP Ledger.
However, Ripple is currently facing a legal battle with the US Securities and Exchange Commission (SEC), which has caused uncertainty regarding Ripple’s future and has hindered its ability to form major partnerships. Despite these challenges, experts believe that Ripple will come out victorious in the lawsuit. In the future, it is possible that mBridge could incorporate Ripple’s technology into its blockchain framework.
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