Building Public Infrastructure for Financial Institutions


Better connected public infrastructure. Photo: Ron Chapple

One of the biggest challenges when it comes to developing Ripple is finding a solution that not only employs the latest technological innovations but also makes sense for our users, primarily financial institutions. Reconciling these often opposing forces is easier said than done, but it’s a necessary exercise. New technologies are exciting, but they’re only useful if we can adapt them to fit the varying needs of the existing system.

Fundamental to our vision of the Internet of Value is that technology and systems that allow money to move like information does today will resemble public infrastructure in that it’s available for anyone to use. Anyone can drive on the highway just like anyone can connect to the Internet.

As such, Ripple is designed with these parameters in mind. Anyone can use and connect to Ripple without requiring special permission, and anyone can setup a Ripple validator. The benefits of this open architecture maximize utility, financial inclusion, and technological innovation.

These characteristics fundamentally allow Ripple to be flexible and accessible, but for the core technology to be useful, we also had to design tools and functionality in such a way that users of the system can ensure an efficient, secure, and compliant experience.

After all, while roads are generally open for public access, it’s not a free-for-all. Over time, regulations have been put in place to optimize for safety and efficiency. Different locations have varying speed limits. Trucks of a certain weight are restricted from certain zones. Some lanes are reserved for buses or carpoolers. And private roads that only select drivers can access sometimes branch off from the main street.

For businesses, rather than reinvent the wheel—or in this case, the highway—it makes sense to take advantage of existing infrastructure in a manner that fits their particular use case.

In the case of Ripple, the design goal then is for the system to be flexible for different kinds of use cases. For instance, banks will require that not only their own customers comply with Know Your Customer (KYC) policies but also the customers of entities they choose to trust and transact with on the network.

Other users will have different requirements due to their use case or local regulations. With Ripple, everyone can coexist safely within the same ecosystem. The goal is to leverage the best of both worlds, one in which private enterprise seamlessly interconnects with and builds on top of public infrastructure.

After all, that’s also how roads work. Despite the fact that everyone is driving on the same open network, our routes will be different based on unique requirements. For some, it’s all about finding the fastest route to the destination. For others, it’s more important to only take familiar roads they know are safe. But ultimately, the more roads there are and the better connected the system is as a whole, the more efficiently we’ll get from point A to point B and the more options for different routes we’ll have.

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