​Atlanta Fed calls XRP an “international payment medium”

What’s new? The Federal Reserve Bank (FRB) of Atlanta in its review drew attention to Ripple’s business model and how the fintech company is using the native token XRP for cross-border settlements. The bank sees XRP as an “international payment medium or wholesale settlement coin,” according to the report, which describes the Web 3.0 space and use of digital assets. However, the document does not say explicitly that the regulator plans to use the cryptocurrency for settlements.

FRB’s report

What else does the FRB review say? The regulator’s representatives highlighted the growing adoption level of Web 3.0- and blockchain technologies among government agencies such as central banks. In particular, they drew attention to the Mariana pilot project, introduced by the Bank for International Settlements (BIS), the Bank of France, and other financial institutions, aimed at making cross-border settlements more efficient. Along with Mariana, FRB mentions Ripple and Stellar, blockchain-oriented companies that are implementing cost-effective money transfers.

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What is known about Ripple? The payment protocol for exchanging and sending currencies is used by government agencies in Australia, Canada, and Israel. The XRP token acts as a bridge and provides liquidity for international transfers, making them faster and cheaper than traditional service solutions. As of May 26, the asset ranks sixth in the cryptocurrency ranking with a capitalization of $24,11 billion and is trading at $0,4646 on Binance, having gained 3,34% in 24 hours.

In December 2020, the US Securities and Exchange Commission (SEC) accused Ripple of selling XRP as an unregistered security. On May 25, 2023, Ripple CEO Brad Garlinghouse said that the proceedings would conclude in the next few weeks. During an interview with Tai Panich, CEO of investment firm SCB 10X, the businessman expressed confidence that Ripple’s success in the current lawsuit will have significant implications for the crypto industry as a whole.

Earlier, Garlinghouse advised entrepreneurs not to open a crypto business in the United States because of pressure from local regulators. At the time, he said, the company had spent $200 million to defend itself in the SEC lawsuit “which, from its very beginning, doesn’t make a lot of sense.”

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In May, Ripple launched a platform for issuing national cryptocurrencies, with which central banks, governments, and financial institutions can also connect their own digital assets to payment services and link them together.