The Big Blue has come up again with an innovative global payment platform on the blockchain. This time, IBM aims at simplifying global transaction for banks and other financial institutions. This network will eliminate a large number of intermediaries’ banks go through before sending money abroad. IBM network on blockchain will take care of real-time foreign exchange and cross-border transactions in many countries of the world. For now, the estimate is 50+ countries, and these transactions will take place using stable coins, cryptocurrencies or digital assets.
The company will assist financial institutions to accelerate and optimize foreign exchange in a bid to improve their services. They also hope to achieve notable improvements in cross-border payments & remittances by these institutions. By using the stellar cryptocurrency, World-Wire will be a sole network provider that facilitates international payments. It will also enable point-to-point funds transfers to eliminate the complexities of using normal banking procedures. We can recall that the company introduced the World Wire last two years in October 2017. However, today, many people are already using the network.
According to what Marie Wieck- the IBM Blockchain General Manager, the network will help countries to achieve their cross-border payments. With it, there will be a smooth flow of money into needy countries where such movements are crucial. Another reason according to the manager is to spur innovation in every sector and promote global financial inclusion.
From the company’s, World Wire is different from other forms of blockchain-enabled innovations. It combines payment messaging, payment clearing and final settlement on one single platform. Also, users of the network can choose from many options of digital assets while carrying out settlements. Presently, World Wire has used forty-eight currencies, forty-four banking endpoints to establish seventy-two payment locations.
Another person from IBM who spoke about the network is the head of the company’s blockchain, Jesse Lund. According to him, the network will improve transparency in the system but will not remove the necessary regulations and policies. It will only ensure that corrupts players are not in the network. He went further to state that using cryptocurrencies will make a great settlement instrument. Jesse also mentioned a few of the coins they are going to use. The company started with Stellar’s native asset which is Lumens and making plans to add Ether or Bitcoin.
The banks have asked to join the network because they realize the numerous benefits it offers them in the foreign transaction. We already know that remittances play a notable role in building the global economy. Although the importance of money transfers to other countries are many, the intermediaries make the process very tedious.
However, the IBM new network will fasten the whole process and also make the exchange to take place in real-time. Since World Wire will work with stable coins and cryptocurrencies for settlements, the process will be faster.
Also, another aspect that will benefit the consumers is in the area of time and cost. Digital assets serve as a store of value which the parties in the transaction decide. As a result, users can transfer their money faster and cheaper than what traditional banks charge.
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