UK Central Bank Tests Ripple’s Interledger Protocol for Cross-Border Payments

The UK’s central bank has released new details about a proof-of-concept it has developed in partnership with distributed ledger startup Ripple.

AccessTimeIconJul 11, 2017 at 9:00 a.m. UTC
Updated Sep 11, 2021 at 1:31 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

The Bank of England has released new details about a proof-of-concept it has developed in partnership with distributed ledger startup Ripple.

Among several fintech proofs-of-concept revealed by the UK central bank yesterday, one test involved Ripple's Interledger protocol, designed to facilitate transactions between different distributed ledger systems.

The trial centered on a cross-border payment scenario in which "two different currencies" were "executed simultaneously in two different simulated RTGS [real-time gross settlement] systems," with blockchain potentially serving as means for synchronizing the settlement of transactions.

According to its outline of the proof-of-concept, the Bank of England used the test in part as a springboard to investigate issues around liquidity, stating:

"Cross-border payments when applied to wholesale markets present different challenges than when compared with retail and corporate transactions, which the Ripple product is designed to handle. The availability of liquidity is one such challenge, and the PoC allowed the Bank and Ripple to begin exploring these questions."

The bank went on to indicate that it could conduct additional trials in this area "to extend its understanding of the dimensions of the synchronization concept."

The Bank of England launched its fintech startup accelerator last year as part of a bid to test new technologies including blockchain, and has been trialing solutions for months. While it has stopped short of green lighting any immediate plans to replace any of its internal infrastructure, the bank is planning for its next RTGS system to be compatible with the tech.

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Ripple.

Bank of England image via Shutterstock

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.