A new cryptocurrency called RBA Coin is in the process of being developed with the backing of the Royal Monetary Authority of Bhutan. Wednesday saw Ripple Labs release a statement saying that the country’s central bank would be using their private ledger to issue and administer the digital ngultrum.
Ripple claims that the shift was prompted by the RMA’s initiative to enhance cross-border payments, bring more people into the financial system, and support sustainability, which the RMA defines as “the only carbon-negative nation in the world.”
The gross domestic product (GDP) of Bhutan, which has a population of 800,000, totaled $2.5 billion in 2020. Despite the fact that thousands of Bhutanese people are denied access to a savings account or credit card because of the government’s “gross national happiness” metric, many sources report on the “happy” metric. Central bank digital currency, or CBDC, will be “easier, quicker, and more affordable,” according to the RMA.
“A successful retail CBDC must be able to manage payments volumes equal to or greater than those in the market today,” said Ripple. Central banks, like the RMA, may now benefit from a CBDC, which will enable them to maintain financial stability and implement monetary policy goals while retaining control.
The introduction of the pilot version of the XRP Ledger to provide central banks with a CBDC solution has been anticipated for the last six months. This service has only just been available for Bhutan, which makes it one of the first nations to implement it.
While other CBDC trials around the globe continue with the Indian government indicating they would introduce a digital rupee in December, and Nigeria’s central bank intending to introduce a digital currency by 2022, no other country has publicly confirmed the rollout of their own CBDCs. Despite this, China has begun testing of the digital yuan earlier than any other countries, beginning in April 2020.
