According to Nikkei, a Japanese financial news agency, the Central Bank of Bhutan will soon launch a digital Ngultrum in collaboration with Ripple.
With the help of its CBDC Private Ledger product, the San Francisco-based business will incorporate its distributed ledger technology into Bhutan's existing payment system.
During the trial period, the central bank digital currency powered by Ripple will be utilized for cross-border and wholesale payments.
According to CEO Brad Garlinghouse, his company's goal is to create a platform that would enable multiple CBDCs to interoperate.
The collaboration appears to have been in the works for quite some time. Tashi Yezer, senior payments system officer of the Royal Monetary Authority of Bhutan, was one of the speakers at the April Ripple Swell webinar for the APAC area.
Yangchen Tshogyel, deputy governor of the central bank believes a digital Ngultrum powered by Ripple will become a "sustainable" payment instrument:
Our cooperation with Ripple demonstrates CBDCs' ability to provide an alternate and sustainable digital payment instrument in Bhutan.
The collaboration is anticipated to boost financial inclusion in the country by 85%.
In early March, Ripple launched a private version of the XRP Ledger tailored for central banks. It marketed the solution as fast, energy-efficient, and dependable.
Ripple CTO David Schwartz presented the notion of federated sidechains on the XRP Ledger, which would enable central banks to establish their networks.
It also released "The Future of CDBCs," a white paper.
Asheesh Birla, general manager of RippleNet, stated in July that his team has been in talks with central banks "for a long time."
Despite its legal problems in the United States, the troubled firm says that its business continues to thrive outside of the country.