The American bank quietly applied for a Ripple patent. Why did the financial giant choose XRP instead of Bitcoin?

The American bank has applied for multiple patents using Ripple's distributed ledger for instant Settlement, demonstrating the confidence of the world's second-largest bank in Ripple technology as a pillar of future financial transactions. This significant development could fundamentally change the global payment system and pave the way for the widespread adoption of Ripple (XRP) and RLUSD stablecoin.

Why did the U.S. bank choose Ripple technology?

Ripple is a startup founded in 2012, and it is not an ordinary cryptocurrency project. Its goals are fundamentally different from Bitcoin's digital gold narrative. The creation of Ripple aims to ensure that remittances are more economical, faster, and more efficient on a global scale, especially for remittances to banks and other large financial institutions.

The core of Ripple is the XRP Ledger (XRPL) - an open-source blockchain that completes payment settlements in 3-5 seconds at a cost of less than a cent. Compared to Bitcoin or Ethereum, XRPL does not require high-energy mining activities, but instead is based on a more sustainable consensus mechanism.

These features make Ripple technology particularly suitable for banking, especially when handling large volumes of transactions that require fast and low-cost settlement. As a financial giant that processes billions of dollars in transactions every day, American banks have clearly recognized the enormous potential of this technology.

XRP: A liquidity solution for cross-border payments

Ripple's digital currency is called XRP, which can act as an intermediary currency between different currency values. Banks can use XRP to settle transactions almost instantly without the need for multiple intermediaries. The total supply of XRP is 100 billion, with no cap.

Circulating Supply: 45 billion XRP

Use case: Liquidity in international payments

This helps XRP attract the attention of institutions eager to transfer large amounts of funds without having to wait several days like using SWIFT services. For global financial institutions like American banks, this efficiency can translate into significant cost savings and improved customer experience.

RippleNet's global collaboration network

RippleNet is Ripple's enterprise blockchain solution. It connects financial service providers, banks, and financial institutions through a single network. Some of its notable users include:

· Santander Bank (utilizing Ripple as its One Pay FX platform)

· Pilot cross-border payment (between Standard Chartered Bank and American Express)

· MoneyGram (previously collaborated with to enhance remittance services)

Overall, Ripple has partners in over 55 countries/regions. The participation of US banks in this network will significantly enhance Ripple's market position and may trigger more financial institutions to follow suit.

RLUSD: Ripple's stablecoin strategy

Ripple plans to launch a stablecoin called RLUSD (USD Reserve Supported Liquidity) in 2024, which will have a 1:1 exchange rate with USD. The addition of RLUSD complements XRP, as it provides banks with another stable liquidity option for cross-border transactions. This hybrid form will help Ripple bridge the gap between traditional finance and cryptocurrency.

The patent applied for by the American bank may involve how to utilize XRP and RLUSD for real-time settlement, which could bring revolutionary changes to the global payment system. If Ripple becomes a pillar of financial transactions, banks like the American bank may be able to make billions of dollars in payments through Ripple every day.

Regulatory Challenges and Future Outlook

Despite facing regulatory challenges from the U.S. Securities and Exchange Commission (SEC) in the past, Ripple continues to gain attention. In 2020, the SEC filed a lawsuit against Ripple, accusing it of selling XRP as an unregistered security. However, Ripple achieved partial victories in this legal battle, a result that boosted market confidence and allowed XRP to resume trading on major exchanges in the U.S.

The move by American banks to apply for a patent on Ripple technology indicates that mainstream financial institutions still have confidence in Ripple's long-term prospects, even amid regulatory uncertainties. This trust may further drive the deep integration of Ripple with global banks and payment systems.

However, regulatory transparency remains crucial. The future of RippleNet largely depends on the attitudes of global regulatory bodies towards cryptocurrencies and stablecoins. As more financial giants like American banks join this ecosystem, we may see clearer and more favorable regulatory frameworks emerge.