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XRP Mentioned in UN Paper on Crypto in Africa: Details

Wed, 01/18/2023 - 16:02
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Vladislav Sopov
Here's how XRP cryptocurrency and Ripple's payment solutions can be helpful in 'banking for the unbanked'
XRP Mentioned in UN Paper on Crypto in Africa: Details
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Community-managed account of XRP enthusiast @WKahneman shared the highlights of the latest report on cryptocurrency's prospects in Africa, made by the United Nations Development Programme team.

XRP can fuel new-gen payments services in Africa, UN report says

The United Nations Development Programme (UNDP), a UN organization focused on supporting countries and communities in combating poverty, shared its Cryptocurrency in Africa: Alternative Opportunities for Advancing the Sustainable Development Goals? paper. XRP token and Ripple Inc. remittances solutions are mentioned as useful instruments.

Authors of the thesis analyzed one use-case for XRP, i.e., using the token in payment corridors for low-cost and nearly instant remittances. Per the text, XRP can bridge two local fiat currencies in a cost-efficient manner.

Through Ripple's Line of Credit (LoC) service, a conversion between the two currencies can be organized at a locked-in exchange rate. Then, the parties can repay the credit on a convenient schedule.

At the same time, since XRP is an altcoin not pegged to fiat currencies, the problem of volatility is inevitable when using it in cross-border remittances. As such, XRP should be hedged by additional financial instruments.

Investments, trust and regulation needed for crypto adoption in sub-Saharan Africa

The authors of the thesis proposed to experiment with industry-scale cryptocurrency derivatives services to let the payment processors protect their capital against volatility spikes.

Also, some recommendations for nation-states in the UNDP paper include supporting local cryptocurrency products, building clear regulatory frameworks and increasing trust in digital assets as payment instruments and as a way of investing.

As covered by U.Today previously, Ripple Inc. strengthens its presence in Africa. In December 2022, its partner started providing remittances from 19 African states to Europe.

Ripple to Facilitate Remittances from 19 European Countries to Africa via Its Partner

Nala, a Tanzanian fintech company, provides the technical basis for this development.

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About the author

Blockchain Analyst & Writer with scientific background. 6+ years in IT-analytics, 3+ years in blockchain.

Worked in independent analysis as well as in start-ups (, Monoreto, Attic Lab etc.)