The island nation of the Republic of Palau has partnered with San Francisco, US-based crypto solutions provider Ripple, to explore the creation of its national digital currency. The partnership will first focus on developing cross-border payment channels that could be facilitated by this digital currency that will be backed by the US dollar, if all goes as planned. As part of the deal, Ripple will provide technical, commercial, design and policy support to Palau. The government of Palau wants to offer people an alternative to bank currencies with expanded financial access.
According to the announcement, if Palau gets a national digital currency, authorities are open to experimenting with its use cases on a decentralized public blockchain called XRP Ledger (XPRL).
Palau is a country of around 340 islands, forming the western chain of the Caroline Islands located in the Pacific Ocean. The country’s economy is impacted by remittances – money sent home by his diaspora, employed abroad.
Such nations, depending on remittances, receive more money from their inhabitants if the transactions were carried out using crypto technology. Since cryptocurrencies are not regulated by any bank, there are no service fees charged on cross-border financial transfers.
As a service fee, international money transfer platforms reduce a significant percentage of remittances and transfer a lower amount than expected.
Earlier in October, a parliamentarian from Tonga, the last Polynesian kingdom in the South Pacific, also addressed the subject.
The official, at the time, said Western Union was cutting more than 50% of its remittances, a hurdle that another small nation El Salvador overcame by legalizing Bitcoin as legal tender.
For now, Ripple is eager to help Palau secure its own national digital currency.
“We have a wonderful opportunity to combine our technology and experience with the unique characteristics of Palau to have a real economic and social impact for the country,” said James Wallis, vice president of central bank commitments at Ripple.
Cryptocurrency Prices on Indian Stock Exchanges
For the latest tech news and reviews, follow Gadgets 360 on Twitter, Facebook and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel.
Twitter rolls out fix for disappearing tweets on iOS, says tweets should now “stay put” while scrolling