Japanese banks piloted domestic and cross-border payments successfully through the Cloud with Ripple.
A consortium of Japanese banks has completed a pilot implementation of Ripple in Japan using a Cloud-based payments platform for both domestic and cross-border payments. The pilot follows tests by RBS last year to see if the Ethereum distributed ledger would support a national domestic payments system.
“Domestic payments are a key focus area for distributed ledger investment, not only in Japan. Anywhere where there are centralized clearing facilities that monopolize payments infrastructure and set ‘per transaction’ or ‘yearly’ fixed costs is ripe for blockchain-type innovation,” says Nick Weisfeld, head of the data practice at GFT, a financial technology consultant. “In addition, locations that are not yet on a faster or instant payments solution could also benefit from the adoption of this technology to improve transaction times without experiencing any of the overheads of centralized infrastructure models.”
The barrier to blockchain adoption has been the scalability of the platforms. “Ripple has claimed to be able to sustain 1,000 transactions per second with their consensus ledger, which is equivalent to the large domestic payment volumes processed via existing traditional infrastructure,” Weisfeld notes.