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The head of government and Ripple's regulatory relations for APAC and the Middle East, Sagar Sarbhai, recently spoke at a FinTech conference on the use of XRP by banks. He also revealed previously unknown information regarding banks and the creation of the xRapid product.
Sarbhai told the story of how XRP was piloted with 12 banks before the creation of the xRapid product. These banks did not have pre-established relationships between ours and ours and were located all over the world. He said:
"In 2016 what we did was the piloting of 12 banks: these 12 banks were located in all regions of the world and had no fixed relationship between them, and what we did was give a little bit Of XRP to these banks and we asked them to settle in themselves and it worked beautifully. "
While the XRP fits in the case of cross-border payments, a system was needed in place that allowed banks to use it. This included reducing the risk of volatility and accounting for regulatory atmospheres. According to Sarbhai, these were the problems faced by banks when they piloted the use of XRP for cross-border payments. He said:
"[They said] we would like to adopt it but we can not, because there are capital requirements and regulatory uncertainty, so they said that, volatile, [and that] there are no rules, so we can not keep those goods in our books. "
This would bring the Ripple team to the drawing board, an idea that eventually evolved into what xRapid is today. To drive technology adoption, Ripple began collaborating with payment service providers who were more likely to try the product. Sarbhai said:
"It works because they do not have to keep the digital resource on their books but using the software called xRapid they can actually connect to an exchange of digital assets, convert fiat into XRP at that time and XRP in real time from the Internet. other part and this happens in 3 seconds so there is no risk of volatility. "
On the general state of the blockchain and cryptocurrency technology, Sarbhai mentioned the confluence of three important factors – services, technology and regulation. He stated:
"I think from the time Bitcoin was implemented there was this idea that down with banks with central banks clearly did not happen."
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