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In a direct push, the Royal Bank of Canada has confirmed that Ripple and XRP can save global banks' holding financial resources based on their recent capital market overview.
Traditional remittance companies and banks dominate
While recognizing that traditional remittance providers – such as Western Union and Money Gram – and banks dominated remittance space, the introduction of blockchain technology solved several critical points.
Blockchain technology has led to decentralization, high levels of transparency but above all has cut out the middle man. Ripple Net has applied the same model and while it fights for customers in the $ 30 trillion market of remittances, Ripple is a cut above the rest.
Not only does Ripple offer low-cost solutions as evidenced by the RBC but their transfers are established in seconds with much greater transparency than traditional systems like SWIFT, for example. In fact, the RBC said that RippleNet offers " transparency of Forex rates and fees, before the transaction originated, and can reduce the cost per payment for financial institutions ".
Ripple improves transparency
In the report, the RBC stated that Ripple created an open source, peer-to-peer and decentralized protocol. To build a functioning ecosystem, Ripple is working with several global banks such as Standard Chartered and SBI for example and although they have three main products: xCurrent, xRapid and XRP, the participating companies have the opportunity to choose what they want. If you select xCurrent as a pre-solution, the company can open efficient communication channels over the network.
However, the xRapid regulation indicates the use of XRP, an on-demand liquidity provider useful for cross-border transfer. The RBC describes XRP as a "bridge" which means that it is a reserve of value that can be transferred between the parties without a central counterparty and thus supports liquidity between two currencies ". [19659006]
They also state their point stating that " banks can consolidate their liquidity into an XRP account instead of holding local currency in accounts around the world " and in the process " minimize the number of intermediaries ".
