Misinformation vs Reality: Clarifying XRP’s Actual Role in Global Payments

Claims persist within the crypto community that Ripple’s XRP is deeply integrated into major financial systems like the US Federal Reserve’s FedNow service, the SWIFT global banking network, and emerging Central Bank Digital Currencies (CBDCs).

These narratives often shoot at XRP set for dominance, with also the positive news around latest regulatory developments and XRP ETF approval.

However, a closer examination reveals Ripple’s specific technologies and the XRP asset generally remain distinct from these established or developing infrastructures.

FedNow and XRP: Setting the Record Straight

The Federal Reserve launched the FedNow instant payment service on July 20, 2023, as an instant payment service for U.S. banks and credit unions to settle transactions in real-time, which eliminates traditional delays.

Despite recurring online claims suggesting integration, the Federal Reserve has not confirmed any connection or use of Ripple’s technology or the XRP asset within the FedNow system.

FedNow operates independently, allowing banks to settle payments without needing cryptocurrencies. While Ripple advocates for blockchain-based solutions, there is no evidence that the Federal Reserve has adopted XRP in any capacity.

Related: ‘Let’s Not Start BS Season’: Critic Dismisses XRP Integration Misinfo

A prominent XRP community member, WrathofKahneman (WOK), has long clarified the situation. WOK debunked the claims on X, stating, “The Fed is not about to use XRP.”

SWIFT and XRP: Parallel Systems, Not Integrated Partners

Similarly, claims often surface regarding XRP integration with SWIFT, the dominant global network for financial messaging that facilitates trillions in cross-border payments daily.

Ripple initially developed its RippleNet enterprise blockchain network aiming to offer a faster, potentially cheaper alternative to some SWIFT processes.

While SWIFT itself has experimented with various blockchain solutions and APIs, it has not adopted XRP as a settlement asset. Instead, SWIFT continues to enhance its own systems, such as its Global Payments Innovation (GPI) initiative, without relying on external cryptocurrencies.

Meanwhile, a video from EastNets mentioning Ripple sparked rumors of XRP’s involvement in SWIFT’s network. However, the diagram shown placed Ripple and SWIFT as parallel systems; not integrated.

WOK also clarified that EastNets supports Ripple’s messaging technology, not XRP itself.

CBDCs and XRP: Platform Pilots vs. Asset Adoption

Central Bank Digital Currencies (CBDCs) represent government efforts to modernize national payment systems using digital technology.

Ripple has actively marketed its private CBDC Platform as a tool for central banks to issue their own bespoke digital currencies, and several pilot projects have explored this specific technology (notably with Palau and Bhutan testing Ripple’s private ledger).

Related: XRP Gets Serious About DeFi: IBC Integration Bridges to Cosmos & EVM

For example, Ripple has worked with Palau and Bhutan to test its private ledger for digital currencies. However, no central bank has officially adopted XRP or the XRP Ledger for CBDC issuance.

Most central banks are developing independent systems, sometimes using other forms of distributed ledger technology, but often opting for centralized approaches distinct from existing public cryptocurrencies like XRP.