According to the CEO Ripple Brad Garlinghouse, Lack of Privacy is the Reason Most Banks Abandon Using XRP.
He spoke about this during a conversation with one of the 35 leading validators. XRP Ledger (XRPL), default unique node list (dUNL) operator.
Garlinghouse acknowledged that privacy features fall short of the expectations of some of the financial giants whose arrival has long been anticipated in the crypto community.
After SWIFT and Stripe services chose competitors XRPGarlinghouse pointed to XRPL’s lack of privacy as a new barrier to institutional adoption.
According to the top manager, financial institutions are reluctant to publish all transactions, including transaction hashes. Uploading data to the XRPL ledger could expose them to additional regulatory scrutiny.
Even pseudonymization of transactions may not sufficiently conceal the organization’s name.
In response to these concerns, Ripple has already implemented a Know Your Customer (KYC) verification protocol called Credentials, which allows identity verification directly within XRPL without the need for third-party services.
XRPL also supports decentralized IDs as a way to manage digital identities for institutions.