SWIFT 2.0? Ripple Signs Major Banks to Blockchain Payments Deal
Today, Ripple announced that they have struck a first-of-its-kind accord, with several major banking interests to created the GPSG, or the Global Payments Steering Group.
Today, Ripple announced that they have struck an accord, a first of its kind, with several major banking interests to created the GPSG, or the Global Payments Steering Group.
Bitcoin has been the king of digital coins for a long time, and no altcoin has really been able to make a mainstream dent in its domain to this point. Ethereum had its run to start the year, but it devised its own roadblock to success called DAO that it is still trying to recover from.
Rather, Ripple has been working in the background quietly, making friends in the banking industry and influencing people to use it for interbank Blockchain transactions.
Think SWIFT built for the 21sty century and beyond
The legacy banking industry has a way to send payments globally, between each other, that has worked well enough for over forty years, and it is called SWIFT.
SWIFT stands for Society for Worldwide Interbank Financial Telecommunication, and it over 200 nations and 9000 banking institutions, worldwide. While SWIFT recently looked over its shoulder at Bitcoin, it might be Ripple that they really need to worry about.
Designed well before the digital age, it is the best interbank messaging and exchange system extant but is in need of a major upgrade. Transactions certainly cannot happen in real-time, and moving money and information is a slow, expensive, process.
It also can be used as a political football, as entire countries can be banned from the network if the United States doesn’t like them, so it has plenty of room for improvement. Ripple’s GPSG could be a glimpse at what the future holds next. A SWIFT 2.0, if you will.
Don Donahue, Chairman of GPSG and former President & CEO of The Depository Trust & Clearing Corporation (DTCC), says:
“The creation of GPSG is significant because this represents the first time that major banks have formulated policies to govern the transfer of money across borders using Blockchain. I’m very excited to be a part of this group of forward-looking leaders who are building the payments network of the future today.”
Building modern payments networks
Mind you it is not designed to target SWIFT as a future replacement, in so many words, but the concept is similar, and should be much more efficient in its comportment, in comparison.
The banking interests involved in the founding of this new venture are a virtual who’s-who, including Bank of America/Merrill Lynch, Santander, UniCredit, Standard Chartered, Westpac Banking Corporation, and Royal Bank of Canada.
GPSG is the first group of its kind; it is the foundation of a completely modern payments network. GPSG is the world’s only Blockchain bankers’ network with defined rules and governance.
One simple integration affords banks access to a global real-time transaction network. With payment rules and standards, process support, and a built-in community, allowing GPSG to offer banks a low-risk way to start using Blockchain technology to accomplish their payments goals.
Julio Faura, Head of R&D at Santander, says:
“It’s time for banks to push on and move from discussing the potential benefits of the Blockchain, to making them a reality. As ever, the devil is in the details. We are joining the GPSG in order to contribute to the definition of the standards and processes which the industry now needs in order to move ahead and build better payments networks.”