The Ripple network has been the subject of much discussion lately. While cryptocurrency enthusiasts worldwide aren’t quite thrilled about Ripple, a lot of major financial institutions seem enthused about it. Most Ripple investors, are patiently waiting for announcements, from the likes Western Union and Moneygram, indicating if and when they will be adopting Ripple’s protocols for their cross-border payments. The exact date is unknown, and it likely hinges on the implementation of a Ripple upgrade named Cobalt.
Cobalt is an upgrade to the infrastructure of the Ripple network. It basically allows for a dramatic increase in the transaction processing capabilities of the network. As the project grows, users wouldn’t have to worry about transactions being stuck, and many believe that this could cut transaction times from 3/4 seconds to one second. A few seconds may not seem like a big deal to most users. If Ripple wants to attract the attention of major financial institutions, then their system would need to be as streamlined as possible.
Spanish bank Santander plans to be the first major financial institution to implement Ripple’s technology as an international money transfer system. In the process, they will make history as the first retail bank to use a blockchain based application to transfer funds. This could cause a dramatic, but positive domino effect for the blockchain and cryptocurrency ecosystem as a whole. Since many people still view cryptocurrencies as purely speculative assets with no real use case. The hope is that if big corporations like MoneyGram, Western Union and Santander use the blockchain for their transactions, this could lend some legitimacy to other cryptocurrencies. Consequently, that will make many skeptics reevaluate their stance on this excellent new technology.
Cobalt is not just a speed booster. It is also an attempt to address one of the main concerns that traditional cryptocurrency enthusiasts have with Ripple – centralization. This new upgrade would actually create another layer of security for financial institutions that need a reliable cross-border payment system. Thanks to Cobalt, there will be no transaction stoppage. The only negatives envisaged could be slow downs. This upgrade would help prevent attackers from causing the entire system to grind to a halt. It would also give Ripple’s corporate partners the assurance to operate with confidence, especially when other cryptocurrency networks suffer attacks. Ripple has been criticized for being too centralized. However, their developers are working hard to fix that for their users in a big way, and make it more attractive for investors.