Ripple, the digital payment network, has partnered with the Republic of Palau to help the Pacific island nation develop its own digital currency.
The initial focus of the camaraderie will see the development of a USD-backed digital currency to help facilitate cross-border payments for the nation. The collaboration "could see the implementation of the world's first government-backed national stablecoin in the first half of 2022," according to Ripple's announcement.
Ripple suggested that the national digital currency may not necessarily be yet another CBDC.
โRipple would provide Palau with technical, commercial, design and policy support. Meanwhile, exploring a USD-backed stablecoin and associated use cases, such as a corporate registry, in the XRP ledger it could provide a viable alternative to central bank digital currencies (CBDC) for countries like Palau โ.
Palau President Suangel Whipps Jr. said the national digital currency "would provide Palau citizens with greater financial access."
As an island nation, Palau is especially vulnerable to some of the effects of climate change, and Ripple said this was one of the reasons it was chosen for the job. The firm said that the XRP Ledger is "carbon neutral and 120,000 times more energy efficient than proof-of-work blockchains."
"We are excited to work with Palau to achieve its financial and climate-related goal," said James Wallis, vice president of central bank commitments at Ripple.
"We have a wonderful opportunity to combine our technology and experience with the unique characteristics of Palau to generate a real economic and social impact for the country."
Ripple is no stranger to environmental and climate considerations. In February of this year, Announced its goal of becoming net zero carbon by 2030, starting with making XRP net carbon zero with the help of the EW Zero tool.
EW Zero is an open source solution from Energy Web that enables companies to purchase tokenized renewable energy to help them become carbon neutral. Ripple too led a $ 44 million funding round for a fintech provider Nelnet Renewable Energy to help fund eco-friendly initiatives in the US.
Related: Bank of Russia Plans to Charge Fees for CBDC Transactions: Report
Ripple has been busy resolving its case with the SEC over whether XRP tokens were issued as unregistered securities in 2013. Brad Garlinghouse recently said that he believes the case has made good progress and will end in 2022.
XRP is currently trading at around $ 1.05. That's 0.42% higher this week, but it's down 5.47% through November.
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