Palau and Ripple partner to create national digital currency

The strategic partnership will create the republic’s first USD-backed digital currency

3D isometric Physical golden Ripple coin with wireframe chain                                 
The Republic of Palau and Ripple will create a national stablecoin using the XRP ledger – Image: Shutterstock
                                

The Republic of Palau has joined forces with blockchain payments company Ripple to create the nation’s first digital currency and to provide a viable alternative to central bank digital currencies.

According to an announcement by Ripple, the partnership will explore Palau’s first national digital currency and its use cases with the XRP Ledger (XRPL). This includes help developing key strategies to facilitate cross-border payments with a USD-backed digital currency for the island nation, which sits in the Western Pacific, around 1,000km north of West Papau in Indonesia.

A national stablecoin using the XRP ledger

Founded in 2012, San Francisco-based Ripple is best known for its cryptocurrency XRP, which once ranked in the top three currencies by market capitalisation, and currently sits at number seven.

Its partnership could see the implementation of a government-backed national stablecoin in the first half of 2022, where Ripple will play an important role in transforming the way Palau's 22,000 citizens access financial services and process efficient cross-border remittances. 

“As part of our commitment to lead in financial innovation and technologies, we are delighted to partner with Ripple,” said President Surangel Whipps Jr. 

“The first phase of the partnership will focus on a cross-border payments strategy and exploring options to create a national digital currency, providing the citizens of Palau with greater financial access.”

James Wallis, VP of Central Bank Engagements at Ripple, added: “We are excited to be working with Palau to achieve its financial and climate-related goals.

“We have a wonderful opportunity to bring together our technology and experience with the unique characteristics of Palau to make a real economic and social impact for the country."

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