As globalization marches on, businesses of all sizes expand into new markets across borders. Consumers, too, are increasingly traveling and moving overseas. This growth has fueled demand for fast, affordable cross-border transactions. However, the traditional banking system struggles to keep the same pace.
Sending money internationally through banks is slow, opaque, and costly. Transactions must pass through a fragmented system of financial institutions, networks, and intermediaries – each adding fees and latency. What may start as a simple payment can take days to process, with the end recipient receiving an unpredictable sum after multiple deductions.
The financial services market gap has led to blockchain-based innovations. Companies like “Stake US” operate a crypto-based sweepstakes platform in the U.S., exploiting blockchain benefits. And currently, crypto companies are creating faster networks for international payments, competing with traditional banks.
The blockchain is the foundation for cryptocurrency transactions and has features tailor-made for moving money globally. As a distributed digital ledger, it can instantly verify and record transactions without third-party intermediaries. Beyond payments, blockchain has additional properties that benefit cross-border commerce, notably transparency, immutability, security, and smart contracts. Together, these technical capabilities are why many predict blockchain will underpin global finance in the 21st century as much as the internet has for communications.
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