Popular Post HAL1000 Posted March 26, 2022 Popular Post Share Posted March 26, 2022 It's funny because I asked Wrath about a year ago about R3 - XDC etc and wondered the same thing, did R3 pull the rug out from under Ripple, the simple answer is no. The complete thread is below, hell it took a while to copy and paste it, God knows what time he put into putting it all together - thanks Wrath WrathofKahneman @WKahneman Lots of q's about Project Dunbar - is it an XRP killer? No, but here's a thread anyways if you are looking for information. 20 tweets; buckle up! For simplicity's sake, let's just consider the latest BIS report on it: https://bis.org/publ/othp47.pdf 1. First the short answer: Dunbar was an experiment to see if CBDCs could work together. That's all. Not live, not at scale. Their own conclusion was it is unlikely all gov's would share one platform. In which case, XRP still has a use case. 2. Dunbar is a POC by AUS, Singapore, Malaysia, S. Africa & BIS (not the 63 BIS member countries). It was conceived as a multi-CBDC system tried on 2 blockchains: Quorum, an ETH chain developed by Consensys & implemented by Partior, and Corda, developed & implemented by R3. 3. Proper use of this mCBDC means participants must already have a national CBDC, btw. It offers a way to pay CBDC to CBDC - or use sponsor banks for countries unable to directly access other currencies - not necessarily eliminating foreign holdings. (p.15) 4. This distinction is important as the "direct CBDC" model creates significant regulatory complications between countries that must "share" their central banks and exposure to each other's policies. They must agree to a rulebook and governance to participate. (graphic p.17, 31). 5. The hybrid model without direct CBDC interaction requires "sponsor" commercial banks, increasing complexity and in some ways mimicking a correspondent system, at least in access. Researchers viewed it as "inefficient" because intermediaries are required (p.31). 6. Dunbar tested xborder settlement, but, "only FX settlement is in scope, and FX trading was taken to be performed outside the platform," meaning that agreement about FX rates and amounts was not even tried - it relied on fixed numbers without trade messaging. (p.24-5) 7. In fact, there are a lot of problems not dealt with in the system, like KYC/AML. All participants have to agree on these standards and harmonize local laws on things like payment finality, for ex. Dunbar was just a pure "could we move CBDC money?" experiment. p.23 8. They discuss the necessary political dimension of a platform rulebook, legal & regulatory framework reviews & the formation of governance committees to ensure proper compliance. Who has the power in such a system? (And put that way, does start to sound a little like SWIFT..) 9. So you have to ask, "who benefits from such an arrangement?" There's no doubt CBDCs are on the horizon, but why would large economies give up a degree of monetary control to participate? Would they be happy to supply their CBDC to banks and let them figure it out? 10.They conclude it'd be best if "a single global settlement platform that connects all CBs & commercial banks" were implemented, but admit it won't happen. Instead, they foresee regional platforms. And that means something would need to go between them. (hint: XRP could) (p.33) 11. So Dunbar-like projects could potentially consolidate some currencies while reinforcing the need for go-between assets. It is still a ways off and no reason they couldn't integrate any other digital assets like XRP, too. And now a word about the tech, Partior and Corda: 12. Partior is a payment platform venture by Temasek (Singapore), JP Morgan and DBS that uses Quorum (Consensys), an ETH based solution. Gas fees are set to null. It's not exactly an open platform, though they say it will be at first. In Dunbar, on AWS. Only SGD & USD right now. 13. Partior sources:- https://t.co/8ZEal0YGcC https://t.co/1BajPgZTcy https://t.co/HPXSIUmvTT 14. R3 used Corda, an open-source blockchain system to build their example. Corda isn't a payment platform. In Dunbar, it ran on Azure. But we have to address the "Corda Settler uses XRP" mythos here... 15. Corda Settler just isn't XRP specific. XRP was the 1st asset implemented at SBI's behest, when Ripple and R3 still had a relationship. But it was built to handle any asset & never intended just for XRP. Check their comments out at bottom of this page: https://t.co/qOGGkM7BUP 16. So settler isn't a backdoor, it's a Corda app you can use to handle any payments, including XRP. And it's likely just as easy to implement XRP payments in a Quorum app, too. Or for BTC for that matter. The ability to use a token does not imply a need for it in this instance. 17. "But R3 has incentive b/c they hold XRP!" True, & at one point R3 had 1b XRP! Now? Well, Ripple & R3 sued each other, & the case highlighted them as payment competitors. Originally limited to sales of 50bps daily volume on XRPL, have they sold it yet? Miguel Vias · 8 Sep 2017 (3/4) Important to note: R3’s agreement was subject to sales restrictions of 50bps of daily volume on the XRP Ledger. 18. Does R3 still have financial motivation to see XRP succeed? Not more than actual current paying jobs. And there's no need to "sneak" it into the Dunbar tests - they could use it in existing products! 19. "But SBI is an investor in R3 & Ripple!" Also true, but SBI has been using Corda for blockchain systems and stablecoins, independent of Ripple so far. They hope for synergy, & have encouraged it but we've never seen any fruit from it. (From Q4 annual report) 19. So where does that leave us? Dunbar was an experiment, that's all. It sought to address a particular aspect of xborder tx's between CBDCs, to prove mCBDCs can technically be done when trust & cooperation are present. (I also think it benefits banks more than govs, ymmv..) 20. XRP is still fast, reliable and trustless for settlement and therefore has a use, even in a world the Dunbar projects come to fruition in with mCBDC platforms. Enjoy the weekend, everybody. Thanx to Wrath for all his insights. JASCoder, Caracappa, 69GTOjudge and 9 others 5 7 Link to comment Share on other sites More sharing options...
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