The Bank for International Settlements (BIS) confirmed recently that the organization has started testing the XRP Ledger (XRPL). They stated the testing phase is for a data-verification system implementation to check how quickly it could anchor and verify data. Information recorded in the blockchain will be tamper-proof, with no changes to receipts.
The BIS working paper noted two features that can help in strengthening their services. Their assessment cited low nominal fees and quick consensus, and also highlighted the XRP Ledger’s proven track record. The institutions’ experiment with XRPL highlights the growing importance of Ripple’s infrastructure. The selection of a foreseeable result puts the fintech company ahead in the financial markets.
However, this is only a testing phase, and BIS is yet to officially get the XRP Ledger’s services onboard. The CEO of Ripple, Brad Garlinghouse, said that he is not surprised by the development as institutions have been regularly turning towards XRPL for solutions. “Is it any surprise that BIS is testing with XRPL. Low fees, fast settlement, and proven track record,” he said.
Moreover, the BIS is experimenting with the XRP Ledger only for statistical data, and not payment services. The analysts presented a proof-of-concept system for confirming the origin and integrity of official statistics distributed through the metadata exchange. This allows users to establish whether published information has been changed after its release. It keeps trust in the data intact with absolutely no changes after it is published.
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How Does the XRP Ledger Support the Bank for International Settlements
The XRP Ledger service converts each statistical dataset into a cryptographic fingerprint which remains permanent. They combine multiple fingerprints through a Merkle tree before anchoring the resulting root on XRPL. Only the root will be recorded on-chain, as XRPL uses a validator-based consensus process instead of the proof-of-work mining system. The BIS researchers are now conducting the tests, and the results on whether to go ahead or skip it altogether will be out soon.
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