Palau joins forces with Ripple to develop its own digital currency.

The Republic of Palau has teamed with Ripple, a crypto solutions company based in San Francisco, to investigate the possibility of developing its own national digital currency. If all goes according to plan, the cooperation will first focus on establishing channels for cross-border payments that may be made possible by this digital currency backed by the US dollar. Ripple will assist Palau with technology, business, design, and policy issues as part of the agreement. Palau’s government wants to provide consumers an alternative to bank currencies as well as increased financial access.

According to the release, if Palau receives a national digital currency, the government will be willing to test its use cases on the XRP Ledger, a decentralized public blockchain (XPRL).

Palau is a nation in the Pacific Ocean that consists of over 340 islands that make up the western chain of the Caroline Islands. Remittances – money sent home by the country’s diaspora who work abroad — have an influence on the country’s economy.

Such countries that rely on remittances would get more money from their citizens if transactions were conducted via cryptography. No service fee is levied on cross-border financial transactions since cryptocurrencies are not regulated by any bank.

International money transfer services take a large percentage of remittances as a service fee, resulting in transfers that are less than anticipated.

A parliamentarian from Tonga, the South Pacific’s last Polynesian country, had also spoken on the matter earlier in October.

At the time, the official said that Western Union was cutting over half of their remittances, a problem that another tiny country, El Salvador, overcame by using Bitcoin as legal cash.

For the time being, Ripple is focused on aiding Palau in establishing its own digital currency.

“We have a fantastic chance to combine our technology and knowledge with Palau’s unique qualities to have a significant economic and social effect,” said James Wallis, vice president of Ripple’s Central Bank Engagements.

Please follow and like us:

Related Articles