BitCoin Arbitrage For Near Free Money Transfer

Have you heard of Cashaa yet? The blockchain startup that is building tomorrow’s financial solution for both the banked and unbanked. Their shot at fame is their ability to provide fiat money transfer at near free fees; meaning for a $1000USD transfer from London to India, you will only have to pay $1 USD. 

You must be thinking they are like UBER, and is going to be subsidizing users to use their app. And will eventually start charging users when they have gained market share or they are going charging some hidden fees. It does not seem that way; and I believe them.

Cashaa is going to lower the costs of cash remittance by making use of the discrepancies in the prices of crypto currencies in different countries such as India, Africa, Indonesia etc. We all know that the prices of bitcoin, ethereum and various in-demand crypto currencies can go pretty high in countries where access are less “free”.

Take a look at these few examples, bitcoin and ethereum skyrocket to sky high prices in times of strong demand because of lack of supply within their countries. But cryptos are borderless, you may ask. But not many of us are willing to accept fiat currencies from these countries and hence the limited supply.

Instances of Sky-High Crypto Prices 

Bitcoin Price Hits $2,850 in South Korea, Extreme Premium (Back in May 2017)

What is fueling Zimbabwe's record-breaking Bitcoin binge?

Bitcoin Price Increases 30% In Venezuela Due to Currency Devaluation

On a day to day basis, bitcoin, ethereum and the likes are also priced higher in these countries due to the lesser supply available. Hence the opportunity for Cashaa to arbitrage and create the liquidity for fiat money exchange. 

I Am Loss. Can You Explain It Again?

Imagine if a person were to transfer $1000 Pounds from London to India. Using the typical Western Union, he would probably have to pay 3% as well as to suffer the retail foreign exchange rates of about 6% margins which is pocketed by the transfer agent and the bank. Ouch!

On the other hand, Cashaa system will only costs you $1USD. Cashaa will work in the background and convert your $1000 Pounds to bitcoin (or any other available crypto) to a crypto trader in London. This bitcoin or crypto is then bought by a crypto trader in India, who will pay Cashaa in Rupee. These Rupee is transferred to your intended party in India. 

Cashaa will offer you wholesale foreign exchange rates as they are going to make money off the arbitrage and not from you. Ok, they will take $1 USD from you but that’s reasonable right?

Where Are These Crypto Traders Working In The Background From?

The crypto traders are not working for Cashaa. Cashaa is operating a peer-to-peer exchange with no fee and 0% price difference from market prices. This sets Cashaa a mile away from the rest of the centralized exchanges and with their multi currencies support (designed for cross-border fiat money transfer), traders from all over the world will be able to trade cryptos with their fiat money. 

Not all countries have exchanges that allow fiat to crypto now.

Do I Need To Know What Is Cryptocurrencies In Order To Use Cashaa?

Nah. Knowledge of blockchain or cryptocurrencies is not required if you are going to use it for cash remittance. This is going to be a $615 billion by 2018 and most of these individuals or companies transferring money are unlikely to be a blockchain participant. They could be a foreign worker working in Europe, USA, Singapore etc and just want to send their money back to their families in India, Phillipines and Indonesia.

Whats the risk to Cashaa? 

When crypto currencies becomes ubiquitous and used universally as a form of payment, money transfer across borders will become a thing of the past. When will that happen? Not sure but I am sure governments are not going to let that scenario realized anytime soon for the implication is the loss of control of money by the State.