Ripple co-founder Chris Larsen believes that cryptocurrencies will help enhance the world economy and may help it to dismiss the risk of next financial crisis. Larsen who attended Money 20/20 conference held in Las Vegas stressed that “ten years out from the financial crisis, we still don’t have the infrastructure, perhaps, to prevent the next one. And I think this is where digital assets can really help, because an efficient digital asset can really solve some of the key problems in global liquidity. The world’s got trillions and trillions of dollars tied up in liquidity, just to get around how clunky the movement of value is around the world.” He argues that efficient cryptocurrencies “can now reduce trillions and trillions in capital from being tied up.” He elaborated further and said, “so you can make those transfers instantly as a bank or as a payment provider or enterprise without having to have money pre-positioned all over the world.”
Larsen argues that “traditional bank-to-bank fiat relationships, also known as nostro accounts. This arrangement is supported because it can be optimal for high volume transaction corridors and uses existing bank-to-bank relationships and accounts. Third party fiat relationships. This allows banks to prioritize those nostro accounts that make the most sense for them, but then augment them with third-party relationships that can overcome the high cost of liquidity in more expensive corridors. Banks can keep the nostro accounts they want and rely on this third party to handle their medium and lesser volume transaction corridors.”
Chris Larsen pays a lot attention to the issue of anonymity. He backs a relevant blockchain-based payment and messaging system dubbed “Elixxir.” Ripple became one of the partners of Bill and Melinda Gates’ fund aimed to diminish the poverty in the world through opening unbanked people an access to financial services worldwide.