Stellar is a cryptocurrency well-known to those who closely follow the crypto industry. It was created by Jed McCable, the guy originally behind Ripple, after he was left dissatisfied with his former partners and decided to start out on his own – and he forked the XRP code along the way to create Stellar (XLM). While the digital coin has not reached the fame of other cryptocoins just yet, it might just get its big break as IBM decided to use the Stellar platform to power its new World Wire payments system.
IBM Moves Stellar-Based Payments System out of Beta Testing
The Stellar Lumens news was no secret, but recently IBM announced that it has moved its system out of beta testing and it is ready to launch. According to the company, it will use the new tool to offer international payments in near real-time.
The news was announced on the IBM website, where it is clarified that the new system uses blockchain tech and the Stellar protocol. Given that, according to IBM, 97% of the largest banks across the globe are IBM clients and that 90% of credit card transactions all over the world rely on IBM mainframes, it is easy to understand that this would be a game-changer both in the industry of cross-border payments and for the future of XLM.
Investors looking to buy Stellar Lumens are on the lookout for Stellar news – and this is exactly the kind of information that proves the digital coin is a strong player.
Clearing and Settling Cross-Border Transactions in Near Real-Time
The new Blockchain World Wire system will be able to at the same time clear and settle international payments within seconds, connecting two financial institutions wishing to make a transaction in two fiat currencies over a digital asset.
The BWW will convert the first fiat currency into the digital asset, and then convert it again into the second fiat currency, recording the transaction information onto a blockchain to verify the transaction. This digital asset could be a stablecoin like Stronghold USD, which is built on the Stellar platform, providing some more Stellar news to XLM supporters.
The IBM and Stronghold USD partnership in July proved this. The two financial institutions will use the BWW API for this process, and IBM aims to offer faster processing of payments and reduced costs. The fact that a record of the transaction is made on the Stellar blockchain also allows the BWW to comply with regulatory requirements by creating a permanent record.
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Will Ripple Suffer from IBM-Stellar Partnership?
After this Stellar news, those investors looking to buy Ripple and similar digital coins, should be cautious, as this new project could undermine the added value that XRP brings to worldwide financial transactions. Like XRP, the XLM platform can handle transactions across digital assets as well as fiat currencies. This means that the new BWW could prove fierce competition for Ripple products that are mainly used by banks and other financial institutions, like xRapid and xCurrent.
Any cryptocoin looking to make it into the financial transactions market will be impacted by this Stellar news, as IBM is a major player in the field. An endorsement of this kind could prove devastating for XRP, which has been troubled by controversy over its decentralized nature – and could catapult the XLM network into wider recognition and further adoption.
The new BWW tool is claiming to offer precisely what the XRP platform has been insisting are its strongest points: extreme speed, drastically cutting back on costs and transaction fees, as well as improved security of payments. McCaleb has also noted the potential of this project to allow more inclusive financial policies with regard to developing nations.
It remains to be seen how this new system will integrate with existing payment solutions in practice.
The content of this article is intended to be used and must be used for informational purposes only and does not constitute investment advice.
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