For the past few months, Leios has been building its software solution for blockchain facilitated cross-border money transfers. We are glad to announce that after much research and development, the MVP for the Leios Link solution has finally been completed. This article will not actually cover details of the MVP, as it deserves it own full-length article. Instead, let us first take the time to recap the bigger picture around the software, where it fits into today’s market, and where Leios is ultimately headed.
The Underlying Problem
The main goal of Leios has always been the same: to provide the means for inexpensive, fast, and easy international transfer of value. We are making cross-border fiat transfers surprisingly economical, yet still simple, as the customer experience is unhindered by the underlying technology, which in our case, is blockchain. To the world population as a whole, the use of blockchain networks for value transfer is prevailingly considered to be confusing, esoteric, or totally inaccessible, due to large gaps in knowledge and interest. Leios jumps these gaps and connects ordinary people to the cost-cutting and speed advantages of blockchain, without the need to even know it is there under the hood.
To this end, we believe in the total abstraction of all blockchain components and providing only the most polished and accessible implementations to the end customer. In the same way a Linux command line still isn’t enough abstraction away from machine code for an average person to make use of the benefits of computers, neither are the current methods of using cryptocurrency enough to make it practical or desirable for a non-technical person to exchange value. Any solution needs to address these underlying barriers to entry, and meet the exact needs of the target market. But let’s take a moment to talk about who the customer of such a solution would be.
The Enterprises in Need of a Solution
To step back to our origins for a moment, our first vision was a business-to-consumer model. Leios wanted to be the software to allow for the easiest, fastest, and cheapest transfer of traditional fiat currencies, such as USD, GBP, MXN, etc. Blockchain is just a means to facilitate this goal in the back-end. Our ultimate goal is to simplify the process until only end result is visible to the user: traditional currency transfer.
This is still the vision of Leios. However, after dedicated research and internal discussion with senior advisors, Leios has shifted its primary customer focus to enterprises instead of direct consumers. The data collected through our research (touched on in our previous article and expounded on in our whitepaper) led us to a more promising target: since Leios is providing a software solution, the sensible starting point is to provide this software to enterprise clients that already have all the components of a money transfer business that aren’t specifically software related.
To be more specific about which enterprises, the ones most in need of these optimizations are businesses that frequently transfer funds across borders. These are current money service transmitters (who generally transmit on behalf of an end customer), ranging from different tiers of remittance companies to different tiers of banks. Beyond them, enterprises that have contracts for goods and services scattered across the globe are beholden to many payment obligations across borders and currency pairs. These enterprises can range from suppliers to global manufacturers. For many, cutting even a percentage point on cross-border payments will lead to savings in the millions.
The Problem-Solving Product
With a focus on what the end-user cares most, Leios will become the top layer of abstraction upon other blockchain-based services, and then add many layers of value through personalization and customization, geared to finally make blockchain cross the line of usability for enterprises.
Enter the Leios middle-ware strategy. This strategy was chosen based on research into two separate, but distinctly related factors:
Factor one: the needs of the actual customers of the market, which are the enterprise clients in our case. We’ve consulted and employed for research compliance officers and others in the banking and cross-border industry, including a consulting firm that specifically helps money service businesses understand blockchain technology. The consensus was the need for a product that allows for the uninitiated in blockchain to press a button and not worry about anything except that they’ve sent funds to the intended beneficiary in their local currency, quickly and with little fees.
Factor two: the state of current technologies that can provide a solution to technical complexity problem. Blockchain is now over ten years old, and it’s been more than a year since the peak of the cryptocurrency bull run and subsequent crash that frankly only served to degrade the broader image of blockchain. At this point, many solutions are being developed that already take care of a lot of the end-to-end problems with fiat transfer through blockchain. The goals of Stellar and Ripple are known to many, but we also have more well-known names creating products such as IBM’s World Wire, made specifically for blockchain cross-border payment, and Facebook’s Libra, which is expected to use its global reach to bring a similar solution to a much larger audience.
With these large players (along with many smaller ones not mentioned here) carving out these new paths for money to flow across borders, for the first time in the history of currency, there’s an actual source of competition in the trillion dollar payments market over which the banks have maintained a virtual oligopoly. Yet, currently no single service can offer a comprehensive global solution. If we define globally comprehensive as nearly two hundred countries served with several different methods to accept and disperse payments, there is a long way to go before blockchain can offer a similar scope of services to current SWIFT-based banking system, or large traditional remittance companies operating through SWIFT.
To meet the current needs to introduce blockchain to the payments industry, Leios envisions a dashboard that white labels different services, and provides a central solution that bridges the gap between what is available and what businesses really need to practically implement a blockchain-based fund transfer solution.
Some important layers of value provided are:
- Comparisons between all the various upcoming service options in blockchain-based solutions. These comparisons can pinpoint the best rates of each solution, and open up the combined geographical range of all integrated payment corridors, including individual exchanges around the world. Leios can orchestrate custom remittance routes based on the desired currencies, locations, payment method, and other specified requirements.
- On the ground consulting and integration services, to offer ongoing support to these businesses, and effectively hold their hand through the entire process, as well as for any post-service activation support.
- Assistance in compliance with regulatory authorities through RegTech solutions, which work both in alleviating issues related to the implementation of blockchain transfers, and even in leveraging blockchain to help accurately automate existing regulatory challenges.
- A risk-free and commitment-free utilization of the most cutting edge in blockchain solution implementation. As a middle-ware with swappable parts, Leios will always integrate the most functional and widely adopted solutions at any point in time.
To speak to the actual current state of the Leios software: the foundational work for demonstrating its essential functionality is complete. In its current form, our MVP white labels two exchange services and links them together to allow for a complete fiat-to-fiat cross-border transaction via the software interface, with APIs and web-hooks taking care of executions in the background. We have a list of other partners who are also in wait to integrate into the software and join the network of remittance options, each one bringing new crypto and traditional currency options, locations, and their set of competitive rates.
We will delve more deeply into the development and functionality of the Leios MVP in our next article.
Our ultimate vision has always spanned a broad horizon. Long-term, we see the Leios solution adding different fiat gateways and exchanges into an ever-growing network, linked together within a central software product. Combine this with our ability to orchestrate between them, and Leios will be the one-stop solution for any cross-border payment, allowing effectively for interoperability between all integrated services. This idea is further explored in our previous article, outlining our vision.
Beyond this model, there are other promising applications of such a network. Instead of just orchestrating between existing entities, Leios can also obtain its own transmission licensing and, using our orchestration data, find and create optimizations needed in this network of transfers, such identifying markets with a demand but no blockchain-based corridors, or introducing additional competition to under-serviced corridors. Leios is willing to find these places wherever they are on the earth and put boots on the ground to figure out how best to fill any confirmed market gaps.
The root of all of this starts with a system that actually identifies and solves problems, instead of imposing its own version of how a blockchain-based system should work, nor is our goal to advocate any specific cryptocurrency, product, or company’s solution. Rather, by design, Leios will implement and integrate what already works, and leave it to the customer — the actual movers of the market — to take advantage of it in whatever way best suits their needs.
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