Some people still dream of Ripple (XRP) being part of a world currency. In a recent series of tweets, Ripple CTO David Schwartz speaks about his very personal view of the US dollar and world currencies in general. In this article, we take a brief look at Schwartz’s opinion.
Ripple CTO Schwartz to World Currencies
In a series of tweets on October 19, Ripple CTO David Schwartz spoke about the role of the US dollar as a world reserve currency. Schwartz said that the importance and role of the dollar is definitely declining.
Still, he doesn’t think that a single currency could compete with the Bitcoin Formula in the near future. The same principle applies to stablecoins – there is also a market leader here, but there are several providers.
“I don’t think there will be a single world currency anytime soon. The same applies to the stablecoins, there are also many here.
No global stablecoin in sight
Stablecoins are a hot and sensitive topic, especially for nation states. The reputation of a threat from stablecoins for national currencies echoes again and again.
A roadmap that the G20 Financial Stability Board (FSB) published last week deals with the topic of stablecoins. Ripple’s favorite topic, namely cross-border payments, is also discussed.
In the roadmap and the paper, both the opportunities offered by stablecoins and the associated risks are discussed. Of course, the report also deals with digital central bank currencies (CBDCs), which the International Monetary Fund and the World Bank are working on with other central banks.
Even if this could accordingly mean that there will soon be “a currency that rules them all”, believes – and now we come back to Ripple CTO – Schwartz does not think so.
I think that many digital and fiat currencies are competing for the role of world currency. There is clearly room for more than one currency. In any case, I see that the role of the USD is becoming less important worldwide.
Ripple as a solution: A bridge is needed
Of course, Schwartz also used the opportunity for a ripple (XRP) pitch. The CTO said that an asset that was as neutral as possible was needed to act as a bridge for the various currencies.
However, the CTO honestly emphasized that Ripple cannot become a bridge for world currencies on its own. After all, the network cannot process the entire world’s transactions.
The XRP Ledger cannot process all the transactions in the world and I therefore do not suggest the “1 network” solution. That would be unrealistic. People have different problems and therefore need different solutions. However, XRP can still be the backbone for international payments.