RUSSIA ANNOUNCES TRIAL OF DIGITAL RUBLE Ripple XRP
The Russian Central Bank has announced that it will be carrying out pilot trials for a digital ruble platform with 12 of the banks in the country.
The development of the ruble platform is expected to be completed by December and the trial is expected to start in January 2022 though details of the technology used and whether it will be on the Ethereum blockchain or Ripple would be used, hasn’t been explained. It also remains unclear whether the platform would be on a totally new blockchain built by the bank themselves, which is another option that is likely to be considered by central banks.
Olga Skorobogatova, first deputy governor of the Bank of Russia, says: “A digital ruble project is aimed to create new payment infrastructure to improve the availability of payments and transfers and to reduce their cost for households and businesses.
“For the convenience of its use, we need to ensure a seamless migration between the forms of the ruble. This is why it is highly important for us to cooperate with market participants at all stages of the pilot project. To organise this cooperation, we have promptly formed the first pilot group of banks for them to have enough time to technically and technologically prepare their systems and processes for piloting,’ he noted.
Central banks have been slowly coming around to the prospect that digital currencies are likely to be the way forward but while some banks have been very proactive in engaging with Ethereum or Ripple to push their digital currencies forward, some other banks are reluctant and they continue to crack down on digital assets in the hope that they would go away.
This is likely to disrupt the world of finance as we know if few central banks and countries switch to digital currencies and few of them don’t. While Europe and parts of Asia are trying to embrace this new technology, some others like the US have been reluctant to accept it. Recently Israel had conducted a trial for a digital shekel on Ethereum while central banks of Switzerland and France also have been conducting trials for digital currencies though they have not disclosed whether it would be on Ripple or Ethereum.
The central bank of Russia has said that the testing would be conducted over several months in various stages with the intent of publishing a roadmap for the implementation of a digital ruble in due course of time.
Trade Ripple to Russian Ruble – XRP/RUB chart
Trading XRP to RUB
The Ripple to RUB combination consists of the national currency of one of the largest economies in the world with one of the most popular cryptos. The XRP/RUB exchange rate may move several per cent during the trading day. Also, the price may move in a clearly defined upward or downward trend during the trading week, fluctuating less than five per cent. Within a 30-day period there are sideways movements which may be broken by substantial price swings of more than 10 per cent.
What is Ripple?
Ripple is an open-source protocol platform enabling the swift and low-cost transfer of funds. At the same time, XRP is the associated cryptocurrency used to execute the transfer process. Unlike Bitcoin and other cryptocurrencies, the XRP cryptocurrency is not mined.
Some crypto experts anticipate that Ripple may dominate international payments in the future as it is a more efficient alternative to the existing SWIFT network, and it has attracted the attention of banks. A growing number of institutions accept Ripple as a method of international payments. Whenever a transaction is made through the Ripple network, the user is charged a minor amount of XRP.
Here are some interesting facts about the XRP:
- The maximum number of tokens for XRP is set at 100 billion. Around 40 per cent of the XRP tokens are in circulation; Ripple owns the majority or around 60 billion of the created 100 billion tokens.
- Transactions made in XRP can be settled in only a couple of seconds. It is much faster when compared with Bitcoin or Ethereum.
- XRP can be considered as a bridge currency. It enables financial institutions to execute transactions cutting down the number of intermediaries and decreasing the transaction costs.
- XRP was created to be used mostly in banks and as a money transfer system and not as a payment currency, unlike Bitcoin which can be used in stores.
Which factors affect the Ripple value?
When talking about the value of XRP, traders should consider the general factors that affect the cryptocurrency markets and also XRP-specific things.
Speaking about general factors, the value of the XRP currency may be affected by the regulatory framework in different countries. This means that traders should monitor potential signals which may indicate a relaxation or tightening of cryptocurrency-related regulation.
Speculative trading might also put pressure on the XRP value, or there may be a sudden increase in demand or supply for manipulation purposes or based on unreliable information. In addition, the supply and demand of XRP on the market can also create fluctuations in the price.
Ripple is trying to attract more customers to use the services. Consequently, when larger financial institutions implement Ripple technology in their operations, this will have a positive impact on the XRP value. So, traders should also monitor announcements in which banks or other institutions share their plans to test or use this technology.