Virginia Marie "Ginni" Rometty, chair, president, and CEO of IBM. Source: Twitter, IBM
American multinational information technology giant IBM has announced a payments network based on blockchain and the Stellar protocol today, dubbed IBM Blockchain World Wire, and has already signed six international banks to launch their own stablecoins on the network.
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“Introducing IBM Blockchain World Wire, the new financial rail that simultaneously clears and settles cross-border payments in near real-time,” the official website of the service reads, adding, “Integrating with your existing payment systems, you’ll replace costly opacity with affordable transparency – and that can bring greater financial opportunity to all.”
According to the website, the service is available to 72 countries and 47 currencies, with 44 banking endpoints and more than 1,081 unique currency trading pairs. “Two financial institutions transacting together agree to use a stable coin, central bank digital currency or other digital asset as the bridge asset between any two fiat currencies. The digital asset facilitates the trade and supplies important settlement instructions,” it explains, adding in a footnote, “For those preferring to avoid the use of digital currencies, IBM also provides alternative settlement methods.”
IBM also told Bloomberg that they are working with six non-US banks on cryptocurrencies. Among them are Busan Bank from South Korea, Rizal Commercial Banking Corp. (RCBC) from the Philippines, expected to issue a stablecoin in the second quarter, Jesse Lund, IBM’s vice president of blockchain, told the publication, adding that the banks are awaiting approvals from regulators. News outlet Coindesk adds Brazil’s Banco Bradesco to these names, claiming that “the rest, which are soon to be named, will offer digital versions of euros and Indonesian rupiah.”
IBM’s Jesse Lund introduces IBM Blockchain World Wire
The service uses the Stellar blockchain, which was conceived as an open source protocol which allows for reportedly easier management of international transactions between as many currencies as possible. The difference between them and their competitor Ripple lies in the fact that Stellar aims to cater to everyone, while Ripple’s end goal is simplifying remittances and micropayments for financial institutions.
“Personally, I think cryptocurrencies could very well serve as a viable settlement instrument. We’ve started with Lumens, which is the native asset of the Stellar network, but we already have the capacity to introduce other cryptocurrencies that could include Bitcoin or Ether. We will add more digital assets based on client demand and participants on the network,” said Lund during a podcast The Crypto Chick with a journalist Rachel Wolfson.