Ripple has been gaining in popularity recently and its latest partnership may be another boost to its reputation. Rumors are brewing that SWIFT, a popular money transmission system, will be replaced by Ripple.
Looks like the Youtubers and Intelligent thinkers are putting it all together now.
It’s not “Just” SAP. Ripple doesn’t have to say a word at Sibos.. Just be looked at in awe as their clients unveil.
This could be the biggest Spring clean Banking has ever had! https://t.co/Fkug2s8sSb
— Daisy Edwards (@DaisyEdwardsOz) October 20, 2018
Ripple recently attended the Sibos Conference, a SWIFT-organized event held in Sydney. Sibos is an opportunity for the most important exponents in the finance industry to discuss areas of development and the technology applied to the economy.
Ripple has maintained exponential growth and has established a strategic partnership with several banks, actions which are fueling replacement rumors. The announcement of xRapid’s launch and the fact that several global clients are already using it shows that Ripple is at a clear advantage. It is also important to recognize that neither Ripple nor SWIFT announced interest in working together.
SWIFT is also currently very interested in blockchain technology, which will increase the effectiveness of its performance. SWIFT’s interest in such technology is not new – in early 2015, the platform announced that it would provide financial support for Linux and the support led to the hyperledger project, a platform “sponsored” by SWIFT.
In 2016, SWIFT began several studies analyzing the feasibility of using blockchain technology on its platform. The study led to interesting results showing that SWIFT has developed an interested in the technology, through Ripple was not working on a project of particular importance. The results determined:
Our analysis has confirmed that DLTs have the potential to bring new opportunities and efficiencies to the financial industry with their key strengths including the ability to create:
- Trust in a disseminated system;
- Efficiency in broadcasting information;
- Complete traceability of transactions;
- Simplified reconciliation; and
- High resilience.
However, despite the benefits, there were tough obstacles that had to be overcome for SWIFT to start contemplating the imminent possibility of migration.
I’m just curious
What does the #XRP Community expect to come out of SIBOS?
— Alex Cobb 💧 (@AlexCobb_) October 18, 2018
Ripple to acquire SWIFT.
That’s possible, anything is possible. There are so many co-incident clues, no doubts.
You can’t disagree with my speculative assumption.
— Steven Diep (@DiepSanh) October 18, 2018
The next question that arises is if it is Ripple and SWIFT or Ripple vs. SWIFT. In 2017, SWIFT announced that it is interested in conducting several preliminary studies in a Proof of Concept blockchain. A number of banks participated in the test, which was:
“designed to validate whether the technology can help banks reconcile their international Nostro accounts in real time.”
The results ere “extremely positive.” In March 2018, SWIFT published a report indicating the results of its DLT proof of concept for Nostro reconciliation. The technology was defined as “one of the largest and most ambitious proofs of concepts run with the emergent technology.”
The report stated:
The PoC went extremely well, proving the fantastic progress that has been made with DLT and the Hyperledger fabric in particular,” said Damien Vanderveken, Head of Research and Development at SWIFT. The DLT sandbox enabled us to control access, to define and enforce user privileges, to physically segregate confidential data and store it only with the relevant parties while supporting a strong identity framework by linking all participants to their BIC, and having all keys signed by a SWIFT certification authority.
SWIFT is in control of a System used by over 1,100 institutions in 200 countries. Even though the platform has accelerated growth, the system’s market share is minimal compared to SWIFT. It is also likely that rather than a commercial partnership, SWIFT is interested in becoming Ripple’s direct competitor. A partnership may be ideal though, considering the experience, offerings, and status each has in the industry.