IBM announced the launch of blockchain based payments, partnering with Stellar Blockchain, dispensing with the need for banking intermediaries in institutional transactions. Called the Blockchain World Wire payment network, it offers clearance and settlement of transactions in near real time.
The company’s announcement on its website stated that the product involved the use of a digital asset as a bridge between two fiat currencies, facilitating the settlement. In other words, a fiat currency is converted into the digital asset at the originating bank, this is then transmitted to the receiving bank where the digital asset is exchanged as a different fiat currency. The transactions are performed through distributed ledgers and the transaction details can never be tampered, giving it the stamp of blockchain immutability.
Jesse Lund, Head of Blockchain Services at IBM, had, in July this year, stated that Big Blue wanted to enable all transactional networks to use blockchain to conclude transactions through a digital fiat currency. The launch, which brought the product out of beta, has been the result of efforts of the Armonk company, since October 2017, on the Stellar Blockchain network. The product will be unveiled in October this year at the Sibos Banking Conference in Sydney.
Other similar products now have competition from Big Blue, and many other players who have jumped on the blockchain wagon. With blockchain entering the institutional transactional ecosystem, it is expected to not just revolutionize, but to disrupt the cross border payment system.