The transfer of currency across borders have always been something that companies and any organization try to simplify as much as possible. Now with digital currency and revolutionized blockchain software, IBM the multinational technology company is making the sending and receiving of currency ten times better.
With this new payment technology being developed it will make it possible for consumers and business owners to send and receive payments without delays. So instead of waiting days for confirmation, the payment will be received within the same day when cross-border transactions take place. However, IBM isn’t the only party involved in this new development as a network of banks has joined the project.
In order to make this development possible IBM also partnered with Stellar, the blockchain start-up. Both companies announced that the main idea behind this new payment technology isn’t just to eliminate transaction delays but to also decrease the cost of cross-border transactions.
Bridget van Kralingen the Senior Vice President of IBM Industry Platforms even stated that, “with the guidance of some of the world’s leading financial institutions, IBM is working to explore new ways to make payment networks more efficient and transparent so that banking can happen in real-time, even in the most remote parts of the world.”
Since Steller and IBM announced their partnership a week into October, the Stellar price has increased by more than a 100 percent to reach 3 month highs. The reason for this price increase is that Stellar’s blockchain technology will function as the “core backbone” for the payment technology. And according to IBM, real transactions are already taking place in the United Kingdom, New Zealand, and Australia, as well as the Pacific Islands.
Although the network of banks using this payment technology is currently only using Lumen, Stellar’s own native currency, it’s to be expected that in the coming months the banks will implement the use of their own cryptocurrency. This can result in the price of Stellar to drop.
Since this technology is also still in the development stage, payments are limited to the use of British pounds and Fijian dollars. This will surely change as the technology improves as the platform was designed to support other currencies that the government has declared to be legal tenders.
When people think of Stellar, another cryptocurrency (Ripple XRP) may come to mind. Unlike micro payments, they have tried to tackle the hugely expensive and centralised cross border payment system. We have previously covered the reasons to buy Ripple.
Altering Financial Landscapes
With the partnership between Stellar and IBM, new opportunities have been presented in the financial world. The partnership has also helped Stellar to grow as a company and according to Jesse Lund, IBM’s vice president of global blockchain development, the partnership is helping financial institutions across the world to collaborate more efficiently.
With this move from both companies, it also indicates as to how big of a role cryptocurrencies play in modern-day currency transactions and banking. With all parties involved benefitting at the moment, we wait to see as to how big of a positive impact this new payment technology will have on merchants a cross the nations.
All parties involved and touched by this new development are completely behind the moves forward as co-founder of Stellar, Jed McCaleb said, “This new innovation and collaboration represents a significant milestone for Stellar as well as the financial technology industry as a whole.”
It’s also expected that in the near future more blockchain companies and technology companies will collaborate to further improve day to day trade between buyer and seller. This is what it means to make progress in the world.