IBM Launches Stellar Backed World Wire Payments Platform
Technology giant IBM Corp has officially launched a new money transfer system backed by the Stellar blockain, a move that could springboard digital currency adoption in the still-lagging payments arena.
Introducing World Wire
The new service, called IBM Blockchain World Wire, utilizes the Stellar protocol to settle cross-border payments in seconds. Once two financial institutions agree to use a stablecoin or other digital currency as a bridge asset between two fiat currencies, IBM’s protocol facilitates the trade and provides important settlement instructions.
According to the official World Wire website, the two financial institutions will be able to connect to the blockchain service use their existing payment systems. By doing so, World Wire “simultaneously converts the digital asset into the second fiat currency, completing the transaction. All transaction details are recorded onto an immutable blockchain for clearing.”
Through World Wire, IBM is attempting to speed up payments clearing and processing to “near real time” and at a fraction of the cost of conventional methods. The platform reportedly eliminates the presence of multiple parties in a single transactions. It also significantly reduces capital requirements for cross-border payments.
IBM Leads in Blockchain Innovation
IBM has been at the forefront of blockchain innovation, having announced several initiatives to incentivze digital currency adoption. Back in July, the Armonk, New York-based company announced it was teaming up with a fin-tech startup to launch “Stronghold USD,” a new stablecoin that is backed by FDIC-insured dollars. As Hacked reported at the time, the stablecoin was seen as a way of helping financial institutions process payments and conduct cross-border transactions more quickly and securely.
Earlier this year, IBM announced it was working with Veridium, an enviro-tech startup, to transform carbon credits into digital tokens. The carbon credit cryptocurrency will be used by companies to offset environmental damage resulting from their business.
All these initiatives are backed by the Stellar protocol.
IBM and Stellar are also working together to develop a global payment network backed by distributed ledger technology. The initial phase of this project is concentrated on 12 currency corridors spanning Australia, New Zealand and smaller islands in the South Pacific.
Stellar has climbed the crypto market rankings this year as other digital assets have faltered. XLM is now the sixth largest cryptocurrency by market capitalization ahead of Litecoin, Tether and Cardano. Last month, Stellar revealed it had one million accounts registered on its network. The platform offers extremely low transaction fees at just 0.00001 XLM, making it an attractive solution for payments processing.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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