"It isn’t really sexy." That’s how Leonard Jaramillo, VP product development at Earthport , describes the way his payment services firm is using distributed ledgers, contrasting its approach to the tech to more convoluted use cases involving QR codes or ‘blockchain’ technology.
Jaramillo is discussing an integration of Earthport and Ripple technology that takes advantage of the efficiencies of distributed ledgers, without using a form of digital currency, or asset linked to the ledger itself.
This means Earthport is using the Ripple Consensus Ledger, the company’s open-source distributed ledger technology, but not its native asset, XRP. Even without using this part of the offering, Jaramillo argues Ripple helps make its cross-border payments processes "better and faster" for all parties involved.
Jaramillo told CoinDesk: "There’s still a correspondent with bank A and bank B, and we use currency held at bank A and bank B. Structurally, that isn’t fundamentally changed, you still have counterparties. The advantage is [transactions] now all happen very quickly and everyone reconciles to single balances on the Ripple Consensus Ledger. They get driven down to near real-time." Jaramillo said that, in this context, the main benefit Earthport receives from Ripple is the ability to unite correspondent banks and market makers in the same ledger for the purposes of cross-border transactions.
"It works solely on fiat currencies. There’s no bitcoin, there’s no XRP. There’s no digital bridging asset, it’s standard [foreign exchange]," Jaramillo emphasizes.
Earthport’s correspondent account network is already live in 60 countries and at 40 institutions. By leveraging this existing account structure, the company has since 1997 worked with banks to offer lower-cost FX conversion.
But the innovation in its latest distributed ledger offering, Jarmillo said, is in the information sharing between the parties this allows.
"Earthport, banks and market makers can be in the ledger system. Today, it’s just the banks […]
