I’ve written an article before on what exactly SWIFT is, but now this article is to address the history of the thefts/hacks, and how Ripple can help provide a solution. So first, the history:
- January, 2015 – $12 Million from Wells Fargo in USA (BDA Ecuador to banks in Hong Kong)
- February, 2016 – $81 Million from Bangladesh Bank and a bank in Vietnam
- October, 2017 – $60 Million from Far Eastern International Bank in Taiwan
- February, 2018 – $6 Million from a bank in Russia (took place last year)
These are just 4 thefts from the past 3 years. One of the responses from SWIFT on these thefts is that SWIFT must be told about it, in order to better their systems and inform the rest of the customer base.
So the question is, how can Ripple help?
Essentially, the transactions are validated on a decentralised distributed ledger, and anyone can download and run an XRP ledger node. The more nodes that are up and running, the more secure the system. This is because the nodes must all agree on the transaction before it can be validated.
In this case, if someone tried to hack into the ledger and take coins, double spend, etc, it would be seen and the person would be shut down. It would take all the nodes to collude and agree to the fraud in order for it to happen. So from this perspective, it’s extremely unlikely for a theft from the Ripple Network to take place.
SWIFT is antiquated and the technology behind it is obviously flawed and the proof lies in the hacks/thefts as shown above. Surely there are more thefts than what I’ve listed above, these are just the latest and greatest.
With xCurrent being deployed to central banks around the world, and with xRapid being deployed to payment providers around the world, we’re entering a super fast, frictionless internet of value, that is equally secure. With the xCurrent customers with the central banks, once they’ve been “onboarded”, they can then flip the switch and be on the xRapid system.
I don’t think the SWIFT network will just disappear overnight, but certainly, they have a massive competitor already knocking down their door. Most likely 2 systems will work in parallel (Ripple and SWIFT), until that is, all the players in the financial world fully see and realise which way is the way to go.
When it comes to competitors, those being competed against may have a negative outlook, however, in my next article, I will show the reader why competition is good for everyone. Of course, it’s only good if those that are involved can continually evolve to their current landscape.
Disclaimer: I personally own XRP digital assets and am a long-term investor/holder in the product. I am not a financial advisor and my reports are not intended as any kind of investment or financial advice. They are formed from my own opinions derived from my own research.
Author: Andrew French