Thread by @krippenreiter

[1/🧵] @DigiEuro interviewed @moderndosh and @AntonyWelfare on the @Ripple #CBDC-Manager software.

The underlying private #CBDC-ledger based on #XRPL was also heavily discussed.

I summarized the most of the interview for you, along with my personal comments. 🧵👇

[2/19] To begin, if you are completely unfamiliar with #CBDCs and the #Ripple solution, here is a nice place to start:

https://twitter.com/krippenreiter/status/1617291492225171458?s=20

[3/19] One important reason for using a private version of the public #XRPL is that a central #bank needs to be able to control the #money supply.

Why use a private ledger ❓
▶️ Central banks and #governments must be able to mint and destroy #currencies.

[4/19] The solution provided by @Ripple is a no-code Frontend for central and commercial #banks to manage #currencies.

The approach provided is always based on assumptions about how the #monetary future may appear, while being simple enough to replicate certain existing methods.

[5/19] Inside the #CBDC-Manager, multiple "personas" & accounts may be added based on the central banks' & monetary authorities' granted permissions, operational demands, & responsibilities

A few examples:
1⃣ Chief Cashier (Central Bank)
2⃣ Distribution Officer (Commercial Bank)

[6/19] — 1⃣ Use of Several Accounts —

1⃣ — Issuing Account —
• #Money issuance (creation of #credit) — Publish a #currency onto the ledger
• The total amount of money accessible in all other accounts combined
• Ultimate source of truth

[7/19] — 2⃣ Use of Several Accounts —

2⃣ — Operational Account —
• One of numerous peripheral accounts used to better track the transfer of cash.

3⃣ — Standby Account —
• Money that has been printed and held in a safe vault before being disbursed to other selected accounts

[8/19] — Several Personas / Account Signers —

1⃣ — Chief Cashier —
• Handling the issuing account's #funds
• #Mint / #Pay / Destroy

2⃣ — Distribution Officer —
• Transferring #payments to peripheral accounts such as #ATMs and outlets
• Decoupling is possible
• #Mint / #Pay

[9/19] — 1⃣ Security —

Multi-#signatures are omnipresent, and various users (Authority profiles) are allocated weight when signing a TX.

If the quorum to actually submit a #TX onto the #CBDC-Ledger is 2/2, then two #signed approvals with a weight of 1 are required.

[10/19] — 2⃣ Security —

That is, according on their weight (approval authority) and permissions allowed, various users have varied powers to #mint and destroy the overall #supply.

For example, as a senior user, the deputy governor has approval authority of 2 instead of only 1.

[11/19] — 3⃣ Security —

Signing for the issuance process can be delegated to various mechanisms that support the process of storing and #signing #TX.

A few examples for key management:
🔹 #Keystore (local)
🔹 #HSMs (physical devices)
🔹 #MFA (2FA)
🔹 #Custody providers

[12/19] — 4⃣ Security —

Institutional #Custodians and third-party providers, in particular, will play an important role in safeguarding the #PrivateKeys.

[13/19] — 5⃣ Security —

Because the platform as a whole is agnostic to how #keys are handled, it may be decoupled to better suit the needs of #financial institutions and central #banks.

I'm sure @StandardCustody / @PolySignInc can be readily incorporated to the procedure.

[14/19] — #Audit Capability —

Because of the underlying #CBDC private Ledger, the tool or application has been audited since its inception.

#Auditors may simply access and examine any relevant information.

[15/19] — External #Wallets —

External wallet accounts, such as @XummWallet, must go through a #KYC onboarding procedure before being immediately linked to the #CBDC-manager.

Sending #money to the app allows you to pay for retail items and services.

[16/19] — Opportunities —

☀️ Interoperability and bridge-building ☀️

#ConnectEverything and solving the #interoperability problem appear to be the most pressing issues.

What is crucial is that #settlement completion must be quick and #environmentally sustainable.

[17/19] To conclude, my most important question for @AntonyWelfare and @moderndosh is about #privacy and #security:

1⃣ — Are you planning to include #ZKProofs into the #AML/#KYC procedure while maintaining digital autonomy in a #CBDC-based financial system ❓

[18/19] My second question:

2⃣ — What is the ideal #security strategy for the #administrator account, given this account appears to have god-like authority over the #system and may possibly pose a severe threat if compromised ❓

[19/19] Thank you to everyone who read my 🧵 about #Ripple's #CBDC-Manager and delved deeper into the technical aspects!❤️

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@krippenreiter

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https://twitter.com/krippenreiter/status/1632495982964252676?s=20

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— My most recent 🧵 on #Ripple's #CBDC digital #currency software solution in significantly deeper depth —

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