Saudi Arabia’s central bank has signed a Ripple blockchain deal for a pilot program to test Ripple’s software in payment settlements. This follows up on various deals Ripple signed recently with prominent money transfer firms around the world for its blockchain system.
In a company statement, Ripple said this pilot program is “the first of its kind to be launched by a central bank”, and it will allow banks in Saudi Arabia to use Ripple’s software to instantly settle payments sent into and out of the country. The Saudi Arabian Monetary Authority will now become the second central bank to form a working relationship with Ripple after the Bank of England.
“Central banks around the world are leaning into blockchain technology in recognition of how it can transform cross-border payments, resulting in lower barriers to trade and commerce for both corporates and consumers,” added Dilip Rao, Ripple’s global head of infrastructure innovation.
This pilot program marks a huge turnaround in terms of the attitude toward cryptocurrency for Gulf nations. Last year, the Saudi central bank warned citizens against Bitcoin trading since it was outside of its regulatory reach, and most regulators in the Gulf area were skeptical about fintech in the first place.
However, that sentiment has gradually changed. On top of this Ripple trial, Saudi Arabia is also working with the United Arab Emirates to launch a digital currency that would be used for cross-border transactions between the two nations. Gulf nations like Bahrain are also exploring the use of cryptocurrencies in the financial industry.
Other noteworthy partners Ripple announced recently include UAE Exchange, one of the Middle East’s biggest money transfer and forex operators, and LianLian, a China-based payment services provider. The startup now has partnerships with over 100 financial institutions worldwide.
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