Ripple (XRP) has partnered with the National Bank of Georgia to develop the country’s Central Bank Digital Currency (CBDC), known as the digital GEL. This collaboration aims to leverage existing blockchain infrastructure, including Ripple’s XRPL and MetaMUI blockchain, to enable seamless digital payments and offline services, essential for the widespread adoption of CBDCs.
The National Bank of Georgia (NBG) has been actively working on digitizing its fiat currency, the Lari (GEL). To ensure the security and scalability of the digital GEL, the NBG has shortlisted nine reputable blockchain companies, including Bitt Inc., Broxus Holding Ltd., Augentic GmbH, Currency Network Ltd., DCM Corp Ltd., eCurrency Mint Inc., FARI Solutions Ltd., Ripple Labs Inc., and Sovereign Wallet Ltd.
By collaborating with experienced blockchain companies, the NBG aims to attract more investors and users to Georgia and position the country as a leader in CBDC innovation. The NBG plans to conduct several stages of testing to ensure the digital GEL can compete with other CBDC projects, such as the Chinese yuan, Nigerian naira, and Jamaican dollar.
The NBG’s decision to partner with crypto-focused companies like Ripple is particularly interesting, considering the European Union’s forthcoming regulatory frameworks. While other central banks are developing their own blockchain infrastructure, the NBG recognizes the expertise and capabilities of crypto-focused companies in handling large-scale transactions securely.
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The adoption of CBDCs is expected to increase surveillance as governments aim to combat money laundering and terrorism financing. However, the introduction of digital dollars in the United States has faced criticism from regulators and presidential aspirants who prioritize privacy concerns. Nevertheless, the NBG intends for the digital GEL to provide a bridge between the traditional financial system and the crypto market, enabling users to easily transition between the two.
The digital GEL’s development will encompass various features of modern technology, such as asset tokenization and tokenized payments. These features are expected to support sustainable growth for global enterprises. By partnering with Ripple and other blockchain companies, the NBG aims to leverage their expertise in smart contracts and environmental sustainability to create a robust and efficient CBDC platform.
Sovereign Wallet, a South Korean blockchain company based in Singapore, has been selected as the technology partner for the digital GEL’s pilot testing phase. Sovereign Wallet’s MetaMUI blockchain offers advanced features for CBDCs, including peer-to-peer transactions and offline capabilities. The CEO of Sovereign Wallet, Phantom Seokgu Yun, emphasizes the suitability of MetaMUI for the NBG’s CBDC project.
As this partnership between Ripple and the National Bank of Georgia progresses, it will be a significant milestone for the development of CBDCs and the integration of blockchain technology into traditional financial systems. The success of the digital GEL project could serve as a blueprint for other countries looking to create their own CBDCs and leverage existing blockchain infrastructure.
In conclusion, Ripple’s partnership with the National Bank of Georgia represents a significant step forward in the development and implementation of CBDCs. By leveraging Ripple’s expertise and blockchain infrastructure, the NBG aims to digitize the country’s fiat currency and compete with other CBDC projects globally. The collaboration between blockchain companies and central banks highlights the growing importance of blockchain technology in reshaping the future of finance.
