Photo Cred To Coin Tuyo Via Flickr
Ripple is widely known for the blockchain powered cross-border payments solutions it provides to banks and other institutions. It currently boasts of more than 200 clients who are using its services.
In a recent announcement on Twitter, Ripple CTO David Schwartz revealed that their latest cross border payments platform xCurrent 4.0 was live for implementation.
The tweet read:
4.0 is live. We’re working to get all customers upgraded, but it’s a complex process. Multihop, xRapid support, much easier peering, and a much easier customer integration process are the major new features.
Rippe’s partners including banks and other financial institutions will now be able to integrate xCurrent to their system to settle cross border payments in a faster, more secure, and cheaper way. The enterprise-focused solution will allow for end-to-end tracking of the transactions. It will also enable banks to discuss the transaction details in real-time before the transaction is initiated and confirm transactions directly through Messenger, a component of the xCurrent.
Schwartz stated in his tweet that the upgrade is a complex process, but they’re trying to help their clients upgrade to the newer version and use it.
The Ripple community on Twitter expressed concerns about the future mechanism of xCurrent, to which Schwartz replied that it would be slightly painful due to its architectural differences from the previous version and it would require changes to customer middleware.
“We are learning a lot about maintaining enterprise software for FIs (financial institutions) and keep working hard to improve our processes,” Schwartz said in one of his tweets.
He further clarified that the upgrade wasn’t mandatory, but explained that it would be like a part of their clients having IPv4 while others working with IPv6. Both of these were interoperable, but until IPv6 was to completely take over the older version, those who run only one of the two and those who run both will have to face some pain points.
Many major financial players in the industry have kept a close eye on Ripple and XRP as they leverage the overall value and service that it imparts to its customers with products like xCurrent. The company seems well in the stance to revolutionize cross-border payments for the banking industry and head toward wider adoption.
The Components of xCurrent
It is an API-backed messaging system that connects beneficiary bank to the originating bank to discuss details of the transactions, including KYC, risk information, fees, FX rates and other payment details. This allows the transacting parties to recognize any wrong or missing information before making the transaction.
The end-to-end payments made through xCurrent has a payment ID that can be used to query the status of the payments instantly in case of delayed or failed transactions. The troubleshooting process surrounding all transactions will be made much smoother with this feature.
ILP (Interledger Protocol) Ledger
Each of the transacting bank’s general ledger will have an integrated sub-ledger to track credit, debit and liquidity of the transacting parties. The sub-ledger is called the ILP Ledger and it ensures that payments are settled atomically, in milliseconds, irrespective of the number of parties involved. This risk of payment failures is eliminated with its use as the transactions are either processed instantly or are cancelled completely. There’s no in-between.
As can be made out from its name, the Validator helps validate payments by coordinating the fund movement across the ILP ledgers of the parties involved in a transaction. Hence, the settlement risks and delays are minimized.
Banks have the option to either run their own Validator for all their transactions or rely upon the other bank’s Validator.
The FX Ticker enables exchange between ILP Ledgers and allows liquidity providers to post FX rates. It also tracks account, currency and authentication credentials for each of the configured ILP Ledgers. The transfers on ILP ledgers are coordinated using the FX Ticker which ensures that the FX quote is valid and then transfers the payment to the beneficiary bank’s ILP Ledger.