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XRP: Ripple competitor Baton Systems could soon take the lead

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“3 seconds is a database update and doesn’t transfer anything. Baton Systems actually settles without any risk. The 3 minutes accounts to update the bank ledgers and actually move the money (settlement).”

For a long time, Ripple has received a lot of attention within the crypto space for its forex settlement capabilities using blockchain technology and its network.

Enthusiasm has grown widespread because XRP, the first and most popular digital asset to live on the XRP ledger, is trading on cryptocurrency exchanges and many investors have been exposed to it, which is the skin in the game.

But Ripple, with its XRP-powered solutions, is not the only player in the forex settlement city using blockchain technology. Among the company’s main competitors is Baton Systems, which was founded as Ubixi in 2016.

The latest news is that Baton Systems’ Core-FX solution has led to the first pay-to-pay (PvP) interbank settlement outside of CLS.

The Core-FX solution is built on Baton’s Distributed Ledger Technology (DLT) and is governed by Baton Rulebook. However, correlated digital assets cannot be found in the cryptocurrency markets.

The solution enables banks to address risks in foreign exchange settlements in general and in emerging market currencies that fall outside the framework provided by the CLS system.

Baton’s innovative PvP solution enables market participants to directly control their settlement cycles, settling multiple times per day, and streamline workflows, leading to significant improvements in liquidity, funding, risk and credit management.

Arjun Jayaram, CEO and founder of Baton Systems, said: “This development is extremely important for the entire FX market, as it provides companies with the opportunity to address settlement risk – arguably the most important governance issue affecting post-trade today.

Today’s announcement demonstrates the tremendous potential this technology offers to global FX market participants to improve risk management, daily liquidity controls, and funding profiles. Using proven technology readily available today, banks can now take control and completely revolutionize the entire post-trade process from trade acquisition to settlement.”

As part of the implementation, both banks have agreed to the Patton Rulebook, a framework designed to provide legal certainty about the finality of the settlement. Baton is partnering with other leading forex brokers, as well as global regulators, to extend market access to fast and risk-free PvP settlement protection to a wider world of participants.

The above foreign exchange was settled between HSBC and Wells Fargo. Major banks intend to start using the Core-FX platform to settle foreign exchange trades bilaterally on demand in less than three minutes, based on PVP with final legal settlement.

Ripple has made a name for itself to build a solution that only takes 3 seconds.

FinanceFeeds spoke to Baton CEO and Founder Arjun Jayaram, who explained the difference between Ripple’s 3 seconds and Baton’s 3 minutes.

To be clear, 3 seconds is a database update and doesn’t move anything. Baton Systems actually settles down without any risk. The three minute accounts to update the bank ledgers and actually move the money (reconciliation). Doing so definitively and not including crypto assets is what makes today’s announcement an industry-leading.”

XRP.org claims a deadline of 3 to 5 seconds, here.

Baton Systems managed to emerge from the inside and hired several insiders, including former CFTC chief Giancarlo aka “Crypto Dad,” former FIA chief Jerome Kemp, and Basel III repair chief Bill Quinn.

The company has already approached ICE Clear after its merger with LCH to automate the overtime workflow and run JP Morgan’s collateral department.

Besides being developed by institutional players for institutional players, Baton Systems has also made its way out of the cryptocurrency titles.

One of the reasons Ripple is seeking the attention of media and individual investors is that the company funds (or funds, amid the SEC lawsuit) its work by selling XRP in the market.

Baton has a different way of doing this and is fully focused on working closely with the industry and has been very successful with it while raising 15 times less money ($19.1 million vs. $293.8 million).

It is possible that the banking industry would rather use Baton’s blockchain solutions than work with Ripple, a company at the heart of the crypto industry, as it could further legitimize cryptocurrencies, stablecoins, and CBDCs, which bankers view as a threat.

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