Ripple is currently considered to be the first choice for banks and financial institutions to integrate blockchain technology into the established system and enable cross-border bank and money transfers. But not everyone in the ecosystem believes in Ripple’s long-term success. Colin LeMahieu, the inventor of nano, is one of them.
LeMahieu believes that the Nano-Blockchain can achieve Ripple’s goals more safely, quickly and cost-effectively. Tests in October found that a nano transaction on Binance was completed in about three seconds, seven seconds faster than XRP. Stellar Lumens (XLM) was completed in six seconds.
The most recent exchange deposit speed test by @bitcoinkit1 has been released and $Nano is still number one, but you already knew that right?https://t.co/dd7LMkko84
– Nano (@nano) October 16, 2018
No wonder LeMahieu believes nano is the best solution. Banks want to speed up the process, which may currently take several days to confirm. He points out that Nano enables an almost immediate settlement and at the same time reduces costs.
Nano is decentralized
Since the foundation under the name Raiblocks (XRB), the nano tokens have been issued completely, without any control of a fund. In contrast, Ripple manages 60 percent of all XRP tokens, since its inception, on a trust account and is relatively free to determine issuance and immission. This could be potentially dangerous for a bank as excessive token control by a third party could compromise security and operational freedom.
LeMahieu told Krypto Briefing that centralisation was a critical issue for institutions. In his opinion, the introduction of XRP by banks is unlikely, as it would give Ripple Labs, the creator of XRP and largest Hodler, a near-monopoly on the entire forex market:.
Many FX companies I have talked to have considered [XRP] and discarded it, based on the fact that a company holds over 50% of market capitalization. A single company that holds so much of a position in a currency is not something they can accept from a risk perspective. This is not accepted by foreign exchange firms as it is a single-point-of-failure which puts a company in a monopoly position throughout the market. No matter how good they believe their governance will be, this is unlikely to be accepted.
Our greatest differentiator from XRP is that we are a true, decentralized currency, not a company. […] This is much more in line with the financial sector, which will never really accept a private entity that controls around 50% of the currency supply for different purposes.
Whether LeMahieu will retain the right, it remains to be seen. Ripple Labs already has a proud number of partnerships with banks, as Coin Hero has reported.