Arab Monetary Fund Offers Alternatives to CBDCs, Including FinTech Wise, SWIFT, Revolut and RippleNet

The Arab Monetary Fund (AMF) has named RippleNet as a potential alternative to adopting central bank digital currencies (CBDCs), a report said Sunday (March 20).

The AMF’s Arab Regional Fintech Working Group has said there’s considerable risk for a country to issue a CBDC, in that local currencies might “lose their basic utilities.”

“There are many risks associated with the international positions on local CBDCs ranging from the risk of ‘digital dollarization,’ international spillovers and the impact on the international role of currencies,” the statement said, adding that CBDCs being used successfully could mean a local currency might lose its function as a medium of exchange, unit of account and storage of value.

“In addition, issuing CBDCs to nonresidents can result in an increase in exchange rate volatility and change in capital flow dynamics since CBDC characteristics make them appealing to investors as an alternative financial instrument,” the group said.

Among the alternatives to CBDCs, which could add similar utility but less risk, included the SWIFT payments system, Revolut, London FinTech Wise, and RippleNet, a real-time gross settlements system.

Read more: Ripple Commits 1B XRP To Advance XRP Ledger Development

PYMNTS wrote that Ripple has also recently committed a billion XRP to encourage developers of its blockchain.

This comes as an extension to the XRPL Grants program, which was debuted last year. That program has awarded $6 million to open source projects built on the XRP ledger. XRPL developers have been looking at ways to build and scale apps on the ledger due to its speed, carbon neutrality and scalability.

Ripple plans to provide support to introduce developer programs, and over the next 10 to 20 years, the XRP donated will be disbursed to developers who are looking to build and scale their apps.