BitShares Taking Remittance Industry By Storm
Last week Bitcoin dominated headlines after hitting all time highs and breaking the $10,000 barrier. While many investors had their eyes on Bitcoin, another blockchain is making major moves in the remittance industry.
The global remittance industry is a multi-billion-dollar market. The World Bank estimates that officially recorded remittances to developing countries amounted to $429 billion in 2016.
A remittance is a transfer of money by a foreign worker to an individual in his or her home country. These cross-border transfers are economically significant for many countries that receive them.
Remittances often compete with foreign aid as the largest capital inflow for developing nations. Many economies rely on remittances to survive. Over 200 million migrants send $600 billion dollars back home each year.
In many of these developing nations less than 20–30% of the citizenry have bank accounts. The other 70% of the population is without access to a bank or financial services and have been deemed “the unbanked”.
There are projects and companies that are looking to revolutionize the remittance industry using blockchain technology. Even though the market is very competitive, BitShares is slowly establishing itself as a dominant force in the industry.
Remittance Services Built on BitShares
BitShares, while getting less exposure than other platforms like Ethereum, has a slew of companies building on the platform. Back in August, Bitspark announced that they will be switching to the BitShares Blockchain from Bitcoin because it is better suited for the company’s business.
Bitspark specializes in remittance payments and sees clear advantages for its services by using BitShares. BitSpark isn’t the only company which sees BitShares as the perfect platform for remittances. Both MicroMoney and Bankcoin have plans to start using the BitShares platform for their business.
MicroMoney recently completed a successful initial coin offering that raised $10 million. The company already has eight exchanges planning to support and trade their token AMM. AMM is a utility token. The token is an integral part of the MicroMoney ecosystem and can be used as an internal payment mean or to get access to MicroMoney’s services.
MicroMoney is an Open Source Credit & Big Data Bureau that connects new customers to all existing financial services. MicroMoney A.I. platform uses complex algorithms to predict creditworthiness of all customers and in just 15 minutes a borrower can get their very first loan in his/her life just from their smartphone.
All aggregated Big Data and Credit Histories are stored on the Blockchain. Thousands of existing businesses will get access to millions of new customers which the company will bring to the global economy.
MicroMoney has 95,000+ unique registered users and operates in Cambodia, Myanmar, Thailand, Sri Lanka, Indonesia and the Philippines. MicroMoney is a fast-growing company valued at $1.85 million, with over 85 employees in six locations around the globe.
The company has ambitious plans for future expansion with everything in place to roll out operations in Hong Kong, Vietnam, China, Malaysia, Singapore and Nigeria. MicroMoney has a working product and access to some of the largest markets for remittance services in the world.
Bankcoin is also working on establishing a worldwide presence. Bankcoin is a global platform, empowering its users through easy-to-use, secure, and low-cost technology, to facilitate transactions and purchase of products and services on a global level. This includes a bold plan to offer services such as international debit cards, ATMS, interconnectivity with other platforms, as well as an online product and services store.
The expressed goal of the company is to become one of the top five cryptocurrency exchange companies in the world by 2020. They see BitShares as the platform that will get them there.
Bankcoin has recently gained the support of the Mexican government and will be featured at the Latin American Blockchain Summit November 9 and 10 in Los Cabos, Mexico. The company has strong ties to Latin America and has put an emphasis on forming partnerships with Spanish speaking countries.
Bitspark, which announced its move to BitShares this summer, has a plan to revolutionize the remittance industry by “removing banks from the equation”. The current remittance system relies on a complex web of money transfer shops and banks.
If a migrant or member of the “unbanked” wants to send or receive funds, they have to go to a money transfer shop (MTO). This can be a challenge because this requires geographical access to the MTO and the banks needed to support its services.
The problem is access to local currency and the network of banks needed to transact. An MTO sender may have a significant cash balance whereas the receiving MTO may have a large digital balance. Traditionally they would be forced to go through banks in order to rebalance. This is where Bitspark sees an opportunity to streamline the process by removing banks all together.
Bitspark plans to solve this problem by using pegged cryptocurrency like BitUSD to rebalance. BitUSD is a market pegged asset on the BitShares platform that has its value pegged to that of the US dollar. Here is an example of how Bitspark would use BitUSD to replace banks.
“A Bitspark Sendy (mobile app) user has a digital balance of 100 BitUSD in their app and would like to make some money. They visit an MTO and offer to sell their digital 100 BitUSD to the MTO for $101 in Cash. The MTO accepts this offer and exchanges $101 in cash for 100 BitUSD. The MTO now has reduced their cash on hand and also received a digital balance to be used for future transactions.”
This removes the need for a bank to provide liquidity. Bitspark eliminates the difficulty associated with accessing liquidity denominated in the local currency, intending to eventually create a pegged fiat cryptocurrency for every national currency in the world with zero counterparty risk and exchangeable for virtually no cost. The same methodology can be applied when rebalancing a “cash poor” recipient MTO. The Sendy user would sell their cash and receive BitUSD.
Bitspark is putting emphasis on developing industry leading mobile apps for remittance. Mobile money services for the unbanked are growing rapidly. It is estimated that mobile money users will reach 1 billion by 2020.
The Bitspark Sendy App makes remittances easy and will help bring financial services to millions of people who had been previously unconnected to the financial system.
Bitspark isn’t waiting for the future, they are using BitShares to build the infrastructure for the blockchain based remittances right now.
“Our focus is on the transition to the BitShares Blockchain for the rest of 2017 and will be fully operating in time for Bitspark’s most recent project with the United Nations”.
Bitspark is partnering with the United Nations Development Program in Tajikistan to study the potential for blockchain remittances as a solution to improve financial inclusion in the country.
Why Are Remittance Services Choosing BitShares?
You may be wondering why so many remittance services are making the switch to BitShares. BitShares is an ideal platform for the remittance industry. The company Bitspark cited four specific areas where BitShares is ideally suited for remittances:
- Pegged Cryptocurrency Creation — Payment providers are forced to go through “gatekeepers” in order to access the 180+ world currencies. BitShares enables anyone to create a pegged asset which has its value pegged to assets like the USD or CNY, and trade it on their decentralized exchange. “The BitShares Blockchain can solve the problem of access as there is no need to hedge USD and rely on a single gatekeeper.”
- Speed & Cost — “The BitShares Blockchain itself is built to scale to 100,000 transactions per second with fees as low as fractions of cents and confirmation times sub 3 seconds.” BitShares is truly an industrial grade blockchain scalable to meet the needs of businesses.
- Liquidity — Liquidity is required to be a market maker, with BitShares, “anyone can issue the fiat pegged cryptocurrency so long as they have appropriate BTS to lock up in a smart contract as collateral. This is important as it means anyone around the world can participate as a market maker”
- Decentralized Exchange (DEX) — Carrying out business on a decentralized exchange significantly reduces risk by removing the reliance on a centralized third party. When a centralized exchange is compromised, millions of dollars and thousands of users are impacted all at once. In a decentralized system, any attack or failure impacts only a single user and their funds.
Bringing financial services to “the unbanked” is one of the greatest economic challenges we face today. Fortunately, it will also provide one of the greatest economic opportunities in history.
The technology known as the blockchain, more specifically cryptocurrency, will unleash the financial power of previously untapped regions of the world. Reaching “the unbanked” is not just about making money, it is about giving people opportunity and a foundation from which they can grow and prosper.
2017 has proven to be a great year for the entire cryptocurrency market. While Bitcoin may be capturing the headlines, platforms like BitShares are actually building the infrastructure for the new digital economy.
Bitspark, MicroMoney and Bankcoin combined will offer remittances to nearly every major region of the world. It is estimated that over $6 trillion will be sent in remittances by 2030. Many of these remittances will be sent using the BitShares platform.
Keep an eye on these projects and expect to see more big announcements from BitShares as other companies begin to understand the full potential of the platform.
If you would like to learn more about Bankcoin, Bitspark and MicroMoney use the links below.
If you would like to learn more about the powerful features BitShares has to offer click here.