- For more than ten years, the BRICS nations have been working to reduce their dependence on the U.S. dollar for foreign trade and reserves.
- XRP could be a token used by the system, as it was created to enable speedy, cheap, and border–crossing payments.
Rumors are swirling that the BRICS alliance, which includes countries like Brazil, Russia, India, China, South Africa, Saudi Arabia, Egypt, the UAE, Ethiopia, Indonesia, and several others, could consider using Ripple’s XRP to support a gold-backed economic system. Why? To reduce their reliance on the U.S. dollar and create an independent, borderless financial system.
The idea first surfaced in 2023 when mentions of the XRP Ledger (XRPL) and its escrow capabilities appeared in discussions and documents linked to BRICS financial planning. Though details were vague at the time, the rumors are gaining traction again as more nations within BRICS look to blockchain for alternatives to the traditional banking system.
Unlike Bitcoin, which is known for its volatility, or Ethereum, which often faces congestion and high fees, XRP was designed from the ground up for fast, low-cost, scalable cross-border payments. This makes it an appealing option for a financial system that spans so many countries. XRP’s unique ability to act as a bridge currency means it could settle international transactions in seconds, cut down on the need for pre-funded accounts, and reduce the friction of exchanging non-USD currencies.
Even if XRP isn’t formally adopted by BRICS, its underlying technology showcases the type of infrastructure that these countries may want to emulate. It highlights a broader shift, one where emerging economies are no longer waiting for traditional financial powers to modernize the system.
Why create a system?
The SWIFT network, the Society for Worldwide Interbank Financial Telecommunication, is the world’s go-to messaging rail for moving money between banks. But for the BRICS bloc, it’s increasingly seen as more of a geopolitical handbrake than a convenience. Although SWIFT is headquartered in Belgium, it operates under strong Western influence, giving the U.S. and its allies the power to shut countries out. Russia learned this the hard way in 2022, when its partial removal from the system cut off much of its international banking access overnight.
Beyond politics, SWIFT is slow and expensive. It only sends payment instructions; the actual money still crawls through layers of correspondent banks, time-zone hurdles, and manual compliance checks, a process that can drag on for two to five days. Every middleman takes a fee, foreign-exchange spreads widen, and operational costs pile up. For fast-growing BRICS economies trying to streamline trade, that’s a drag.
Faced with those risks and costs, BRICS members have begun building their own rails: Russia’s SPFS, China’s CIPS, and India’s expanding UPI network for cross-border use. These alternatives aim to keep transactions flowing even if SWIFT ever becomes a political choke point again.
Expect the topic to headline the 17th BRICS Summit in Rio de Janeiro on July 6-7, 2025, where Brazil, this year’s chair, plans to push for deeper South-South cooperation and broader reforms in global finance. Meanwhile, XRP is trading at $2.43 after a 2.17 percent rise this past week.
Credit: Source link
