Comparing Stablecoin vs. Traditional Payments & Remittance
As conventional cryptocurrencies reel from extreme volatility and scandals, the ecosystem for stablecoins has exploded. Many crypto advocates believe stablecoins can turn the tides in the crypto space.
What stablecoins bring to the table is the ability to transfer from fiat to crypto quickly, allowing one to protect their capital as well as easily convert it back into fiat, which is vital in a highly unstable market. Powered by blockchain, stablecoins have the potential to revolutionize many business processes. As you will see in later stages of this article, sectors such as remittance, retail payment, and cross-border transactions can get a serious facelift in the coming years.
What are Stablecoins?
Stablecoins are a type of cryptocurrencies that have their value pegged to another asset. The asset could be fiat currency, other cryptocurrencies, or precious metals like gold. Currently, fiat is the most preferred asset option. For example, one unit of stablecoin could be equivalent to $1.
Because stablecoins operate within the blockchain, they come with all the benefits of blockchain technology.
As a decentralized network of records, blockchain technology ensures stablecoins are always secure, and all transactions are completely transparent. The elimination of intermediaries, and the features of blockchain play a big role in speeding up transactions on the network, compared to traditional networks. The use of the internet makes stablecoins easily accessible anywhere across the globe.
Like many digital coins, the most obvious use case of stablecoins is in making payments. The digital coins can be used to make transactions faster, cheaper, and transparent. They can be used to give traditional payment systems upgrades that are long overdue and highly desired by participants.
What are traditional payments?
Traditional payment systems are common everyday methods of conducting financial transactions. They include bank transfers, online money transfers, and money transfer operators.
As great as these payment systems have been over the years, they are not short of disadvantages. For example, high fees make the systems quite expensive, and slow transactions make them highly unreliable in regard to timeliness.
They are also not easily available to everyone across the globe. Some people, especially those in villages and developing countries, have to put in some miles before accessing a bank or money transfer operators in case of remittance. Not to mention that many are unable to be banked due to a lack of identification, which, in many developed countries is taken for granted.
What is Remittance?
Remittance is the money sent from one person to another, usually overseas. People who leave their homes and travel abroad to look for work send remittance back home quite often.
Note that remittance is not just money sent to family and friends but also money sent to make business payments. Because of the internet, many international businesses can make remittance payments for invoices anywhere in the world.
What are the costs of remittance?
Like all other traditional payment systems, providers of remittance services have problems like high fees, fraud and embezzlement, centralization of control and slow money transfers, which inconvenience many people. It is for such reasons that the use of crypto for remittance is growing in popularity and necessity.
Blockchain and cryptocurrencies like stablecoins offer easier, cheaper, secure, and faster ways to make payments and conduct cross border transactions.
People working abroad don’t have to worry about high fees and slow transactions anymore when it comes to paying remittance. Fraud and embezzlement, also become a thing of the past when properly utilizing stablecoin remittance.
Why Stablecoins are more beneficial
One of the many reasons why stablecoins are more beneficial than other cryptocurrencies is their stability. Unlike other cryptocurrencies, stablecoins are rarely exposed to the volatility that other cryptos see.
With stablecoins, money transfers get faster and cheaper. Because of blockchain, trustless transactions become possible. There is no longer the need for intermediaries for efficient services.
Furthermore, because stablecoins operate in a decentralized network and are fortified with high-tech cryptography, they strongly secure you funds. The transparency level provided by the network, audits and attestations ensures nothing suspicious goes unnoticed in the network.
There are several platforms already utilizing Stablecoins to make money transfers, faster and efficient. One platform is Stably.
How Stably helps with Stablecoins
Stably is a fast-growing FinTech company that is the creator of Stably USD a USD-backed stablecoin. The coin is also known as USDS and is currently the seventh-largest USD-backed stable coin in the world. It is featured in major cryptocurrency exchanges like Binance, Binance DEX, and Bittrex.
Stably is leveraging the power of blockchain to make money transfers faster, cheaper, and transparent. With stablecoins, one has to worry less about the sudden price fluctuations of crypto tokens, which can be costly and unpredictable.
How Stably helps with upcoming Stably Prime
To enhance its blockchain based money transfer services, Stably is looking to introduce Stably Prime, a multi-currency highly secured borderless Custodial Account.
The custodial account allows users to hold, send, and receive USD, cryptocurrency, and stablecoins from anywhere across the globe. The services are instantaneous and take place 24/7.
Stably Prime also comes with:
Cold storage for digital assets
FDIC insurance for up to $130 million in USD
Global KYC/AML support in over 150 countries
As an online platform, Stably is fully accessible anywhere in the world. Anyone can simply access the internet and open a Stably Prime account, get KYC verified, deposit funds and enjoy the benefits that come with the account.
Stablecoins have the potential to change the money transfer sector completely. These coins bring cost-effectiveness and speed to a sector that is slow and quite expensive. Powered by blockchain, they also promote transparency and easy accessibility. Anyone situated anywhere across the globe with access to the internet can access the digital coins.
Platforms like Stably Prime, show that the way money and value are transferred and managed need to move into the 21st century and get the much-deserved upgrades that today’s current technology can enable.
Are you ready to experience money as the 21st century intended?
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