37% of companies use blockchain for X-Border payments
With rare exceptions, even slow cryptocurrency transactions are faster than many other payment methods. Most blockchain transactions are completed in minutes, rather than hours or even days, and are able to provide assurance against errors or fraud through the openness of distributed-ledger (DLT) technology.
This increased speed becomes especially important for cross-border transactions. In fact, more than 37% of businesses said they currently use blockchain and cryptocurrencies for cross-border transactions, according to the Blockchain Payments Tracker, a PYMNTS and Algorand partnership.
Get the report: Blockchain Payments Tracker
In addition, another 13% of the companies surveyed said they wanted to use crypto for that purpose. In total, 50% of companies use or want to use blockchain and cryptocurrency for cross-border payments.
Transparent, fast, safe operation
On Monday (July 11), Agrotoken, a global tokenization platform focused on agro-raw materials, announced that it has teamed up with Pomelo and Algorand as strategic allies for the implementation and development of a map designed for the agricultural sector.
Read more: Agrotoken expands the Visa partnership with payment cards for the agricultural sector
The Algorand blockchain will be used to make operations transparent, fast and secure. The blockchain offers high scalability and low energy consumption due to its focus on sustainability to minimize the environmental impact, the company said.
“Integrating Pomelo and Algorand into this existing partnership with Visa demonstrates the versatility of our cryptocurrencies,” said Agrotoken CEO and co-founder Eduardo Novillo Astrada in the announcement. “Agrotoken is here to change the agricultural sector, not only in Argentina, but throughout the region, and this is possible thanks to various companies and platforms that supported us and our expansion into new horizons.”
Offers clear benefits
This is just one of many uses for blockchain and crypto. For example, between early 2020 and early 2021, the value of remittances sent to Latin American countries using crypto exploded from about $ 100 million per month to almost $ 400 million per month.
This was probably largely driven by the desire to avoid high transaction fees, but cross-border cryptocurrencies also provide clear benefits in terms of predictability and speed. Even the Ukrainian government has seen the benefits of cross-border crypto payments, as international aid has flowed into the country through crypto-transactions, unhindered despite the country being in the middle of a war.
Blockchain payments remain in their infancy as a replacement for fiat currencies. While some sellers may be reluctant to trade directly with blockchain payments due to the volatility of the value of some cryptocurrencies, the benefits of a faster and more reliable payment method that removes intermediaries drive interest in the potential for blockchain payments.
To aid in this revolution, the increasing use of proof-of-stake protocols, which are faster, more efficient and, as a result, less expensive than the traditional proof-of-work protocols that were the early standard of blockchain technology.
High-friction transactions such as cross-border payments can offer incentives for several industries to take a serious look at the development of blockchain payments.
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