Ripple’s Vice President for EU strategic accounts told CNBC that Ripple sees China as a new opportunity for their cross-border payment business. Ripple VP Jeremy Light said that “China is definitely of interest. It is definitely a target,” and that, “China is definitely a country and region of interest.”
While this stance from a VP at Ripple may seem counterintuitive given the Chinese Communist Party’s stance on cryptos, Ripple is a lot bigger than their XRP token. Ripple has industry-leading settlement technology. Ripple’s xCurrent payments platform doesn’t use the XRP token, but it could help Chinese banks settle international trades quickly.
There has already been a push by Chinese financial entities to enter the blockchain development space. Ripple could be attempting to build on the enthusiasm for blockchain that has rushed through China recently. This week saw the introduction of a blockchain policy manual for Chinese leaders, which is a de-facto endorsement of blockchain at the highest levels in the Chinese power structure.
Ripple has a firm Asian base to build on
Ripple is already doing business with some of the largest banks and financial firms in Asia. They are working with 61 of Japan’s largest lenders to run a 24/7 settlement platform that would eliminate downtime. Ripple is also working with Hong Kong-based LianLian, as well as mega bank Standard Chartered.
There isn’t much transparency when it comes to how far Ripple’s technology has actually been deployed in the marketplace. For Chinese markets, the platform could help domestic banks settle trades with clients from all over the world. Many associate the Chinese market with payment platforms like Alipay, but the market for Ripple’s products could be much larger than consumer payments.
China is in the early stages of the Belt and Road Initiative (BRI), which seeks to connect Chinese manufacturers with the Eurasian continent. A big part of the BRI is based in international lending, which ultimately means cross-border remittance at a state level for decades to come.
Making the right connections
Ripple could use blockchain to not only provide efficient trade settlement but also help Chinese lenders to stamp out corruption in BRI projects. The recent power-shift in Malaysia exposed how corrupt some of the BRI lending operations were in the country, and also demonstrates the need for a higher level of international oversight.
Blockchain technology could make sure that state funds don’t end up getting lost in a complex financial network that is subject to fraud and corruption. International financial transactions can be tricky to manage, but the record that Ripple’s platform creates could help China to ensure that their foreign interests are kept on the right side of the law.
The crypto-world moves fast, but so do we!
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Nicholas Say was born in Ann Arbor, Michigan. He has traveled extensively, lived in Uruguay for many years, and currently resides in the Far East. His writing can be found all over the web, with special emphasis placed on realistic development, and the next generation of human technology.