In an interview with Finextra.com on 21st September, Marcus Treacher, the Global Head of Strategic Accounts at Ripple, spoke about distributed ledger technologies and its impact on the economic ecosystem. Treacher focused on the ease of payment that is provided by ledger technology and how it can be used to make people’s life easier.
Treacher stated that distributed ledger technology allows cross-border payments to be interconnected with each other much like payments within a country that does not require a lot of gateway entries. He said that the paradigm shift is huge with the potential to completely overhaul the system that is already set in place.
According to Treacher, the main advantage of the technology is how it eliminates reconciliation work, chasing of funds and the lack of clarity from the ambit of the functioning of any financial body. He also said that this power possessed by the concept of distributed ledger technology has to be fully utilized, especially when it comes to the financial infrastructure present in the ecosystem right now.
The Ripple official also added that the current infrastructure is more conducive to retail investors rather than institutional investors, making it more complicated than the S & P ecosystem. He went on to say that oversight of problems is a big issue in the cryptosphere, which does not attract institutional investors. He further added:
“It is very easy to make the case for distributed ledger technology. The theory is rock solid, only the groundwork takes some time. The technology provides a much better delivery layer, that is, a foundation upon which future applications can be built. Think of it as the ultimate Intel Inside for the payments network.”
Treacher added the analogy that using distributed ledger technology is like turbocharging a car for better performance, where the car is the entire fintech ecosystem. He also spoke about how the advent of the PSD2 will revolutionize the financial world.
The PSD2 or the Reversed Payment Service Directive is a regulatory notification released by the European Union that would open up the markets to a variety of new investors and companies. This, some reports say, will reduce the monopoly of banks in the financial space.
With the implementation of the PSD2, banks will be pressured to make transactions much faster and provide better functionalities to the users, said Treacher. He also went on to say:
“With distributed ledger technology, the likes of Ripple will make it easier for banks to run at the same pace as that of other organizations.”
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