Ripple has introduced new features to improve its Ripple Consensus Ledger (RCL) and Interledger Protocol (ILP) to enhance transaction throughput, especially for cross-border payments. These improvements bring Ripple the same transaction throughput as Visa, the world’s largest payments network, and offer a solution to antiquated cross-border payments. Under the current payment system, with banks struggling to handle rising transaction levels, a transaction can take as long as three to five days.
ILP and RCL can now work together to create a network connecting all types of value on ledgers. The network meets the demands of the traditional financial world, traditional payments and digital assets.
A representative for Ripple told CCN.com:
The feature updates consist of Escrow and Payment Channels. Escrow allows Ripple Consensus Ledger (RCL) to communicate with the Interledger Protocol (ILP) to lock up payments until a determined time. It completes this task securely without having to trust intermediaries and no single institution is in charge of holding the funds, which is a major benefit to our customers.
Two New Features
Escrow and Payment Channels, two new features, increase RCL’s scalability and performance. Escrow enables ILP and RCL to communicate to secure XRP for an allotted time period or until specific conditions are met.
Escrow can hold funds for a certain occasion or until a service has been performed. It completes the task without the need to trust intermediaries, and there is no central authority holding the funds. Banks have traditionally accomplished this using a vault. Escrow is the first readily available option for digital assets.
Digital technologies were not created to manage high amounts of volume. As a result, transactions are slowing significantly.
In response, Ripple developed a payment channel for XRP, RCL’s native digital asset. The channel permits a transaction throughput that increases to tens of thousands per second. This brings Ripple’s scalability to Visa’s level.
The Ripple representative added:
Our Payment Channel is specifically designed for XRP and allows transaction throughput to increase to tens of thousands of transactions per second. XRP saw nearly 70K transactions with an average time of 3.7 seconds.
A More Efficient Way To Pay
By being able to transfer money as fast as a credit card swipe, XRP payment channels can change the way people send money.
Companies will be able to adopt ILP and RCL. Users will receive XRP’s benefits and have a faster, cheaper option for cross border payments.
XRP represents the best liquidity option for emerging markets that have old banking infrastructures since it increases flow and allows better usability.
Ripple seeks to make what’s known as the Internet of Value (IOV) a possibility. To accomplish this goal, the right infrastructure is needed.
Being able to transfer tens of thousands of transactions per second marks a big step towards IOV. It also helps Ripple expand its role in global payments.
Ripple’s On A Roll
Ripple’s market capitalization recently hit a 26-month high at $400 million as the value of an XRP token nearly doubled in a 13-hour period on March 31.
In addition, Japan’s largest bank, MUFG, recently announced that it chose Ripple to join its Global Payments Steering Group.
Featured image from Shutterstock.
Last modified: March 4, 2021 4:55 PM