Global payments network Ripple has partnered with the Republic of Palau, an island nation in the western Pacific, to help it develop its own digital currency, the company said in a press release on 23 November.
According to the announcement, the partnership will initially focus on developing strategies for cross-border payments and a digital currency that could be a good alternative to a central bank digital currency (CBDC). Ripple intends to explore a USD-backed stablecoin — and associated use cases, such as a corporate registry — on its own decentralized public blockchain, the XRP Ledger.
The company noted that this collaboration could see the “implementation of the world’s first government-backed national stablecoin” as soon as the first half of next year. In order to help the citizens of Palau gain “greater financial access”, Ripple will provide the project with technical, business, design, and policy support.
One of the reasons behind the Republic of Palau‘s decision to partner with Ripple was the company’s XRP Ledger, which claims to be carbon-neutral and 120,000x more energy-efficient than proof-of-work (PoW) blockchains. The VP of Central Bank Engagements at Ripple, James Wallis, said in a statement:
“We are excited to be working with Palau to achieve its financial and climate-related goals. We have a wonderful opportunity to bring together our technology and experience with the unique characteristics of Palau to make a real economic and social impact for the country.”