It’s official, IBM is open for business in payments with World Wire in 72 countries and 47 currencies. Support for stable coins and cryptos
The IBM initiative, which is powered by Stellar’s blockchain, is a huge threat to Ripple. Ripple has always positioned itself and its associated cryptocurrency XRP as the future standard for banking remittance payments.
IBM’s head of blockchain Jesse Lund said the interest was sparked by JP Morgan’s controversial stable coin, JPM Coin. The two “major banks” in question have not been revealed.
JP Morgan sent shockwaves through the crypto community when it launched its own cryptocurrency, JPM Coin in February. JPM Coin is a stablecoin, pegged to the value of a dollar. It will be used to instantly settle transactions in the bank’s payment network, reduce transfer times, and ultimately reduce friction in international transfers.
After the announcement, other major banks in the US jumped on the bandwagon. Jesse Lund explained:
“We have received interest on the heels of JPM Coin… [The two major banks] “reached out to us after that announcement.”
Whether good or bad, JP Morgan has kicked off a new movement in blockchain: bank-issued digital currencies.
SIX OTHER GLOBAL BANKS WILL ISSUE CRYPTOS THROUGH IBM
Also on Monday, IBM revealed that six global banks had signed a letter of intent to use its blockchain network. The six banks will issue stablecoins tied to their local fiat currency.
Among the names are Brazil’s Banco Bradesco, South Korea’s Bank Busan, and RCBC in the Philippines. A further unnamed bank will issue a stable coin pegged to the euro.
“RCBC is pleased to be an early innovator with plans to issue our own Peso stable coin on [IBM’s] World Wire, pending final approval from our regulators.”
While IBM grabs the headlines, don’t overlook Stellar’s role in this new movement. IBM’s Blockchain World Wire network runs on Stellar and will even use Stellar’s lumens to settle some transactions. Explaining the choice to use Stellar, Lund explains:
“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.”