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Unlock Future Global Payments – Jane McEvoy, BVNK, The Fintech Magazine

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TLDR:

  • Cross-border payments have historically been slow, expensive, and inefficient.
  • Blockchain technology and stablecoins are revolutionizing the international payments landscape.

Cross-border payments have long been plagued by slow speeds, high costs, and tedious processes. While domestic payment systems have advanced to enable near-instant transfers, international transfers have lagged behind. However, a new wave of blockchain-based solutions is on the horizon, poised to transform international payments into a realm of real-time settlement without the need for traditional clearing services.

Blockchain technology, with its shared, immutable ledger, and distributed ledger technology (DLT), offers transparent, high-speed transfer capabilities. When paired with stablecoins, which are cryptocurrencies designed to maintain a stable value relative to a fiat currency or commodity, these technologies can bypass legacy cross-border payment systems, eliminating currency conversion costs and challenges.

Institutional support for blockchain and stablecoins is on the rise, indicating a cultural shift in the payments landscape. Major banks and organizations are increasingly adopting these technologies, recognizing the benefits they offer in terms of speed, security, and cost-efficiency. Both mature and emerging economies are embracing the dynamic combination of DLT and stablecoins, with Latin America emerging as a leading adopter.

While blockchain and stablecoins are reshaping the future of global payments, they are unlikely to entirely replace traditional methods. A multi-rail system, combining blockchain technology with local payment methods, is anticipated to be the way forward. This coexistence of ‘true stablecoins’ and central bank digital currencies (CBDCs) is expected to define the future payments ecosystem.

Overall, blockchain technology and stablecoins are poised to revolutionize cross-border payments, offering faster, more secure, and cost-effective solutions for businesses and individuals around the globe.

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