Ripple announced that it would test a private version of XRP explicitly designed for central banks earlier this month. They released a new whitepaper pointing out that XRP could be used as a bridge currency for Central Bank Digital Currencies(CBDC).

The paper, named “The Future of CBDC,” said that interoperability, public and private partnerships, and neutral bridge currencies are the three keys to overcoming every Central Bank Digital Currency. Ripple also mentioned that a neutral bridge asset could be introduced to support healthy, alternative liquidity markets to allow for real-time frictionless and cost-effective value movement between various CBDCs.

The report also states that XRP can bridge different central banks’ digital currencies quickly and effectively.

Ripple (XRP) is the seventh-largest digital asset with a market cap of $21,888,092,054 and is trading for $0.477568 at the time of writing. The coin has established itself in the price range of $0.415-$0.5 since the beginning of March. 

“Ripple fintech decacorn has published a report on the evolution of CBDCs, believing that XRP can provide support to these bank-issued stablecoins to serve as a bridge currency for them”

XRP Can Support Direct Exchange of CBDCs: Ripple https://t.co/IhPjcOZmwA

— IN (@Ianbins) January 7, 2021

The rising moving average ribbon and MACD indicator point to a bullish market. However, According to Data Analyst Annie Li, there are indications that XRP may be oversold despite the recent surge. As more sellers enter the market, XRP’s price could fall and start on a downward trajectory.