Bitspark, a crypto-financial provider for the APAC region providing blockchain powered end to end remittance services has announced it will be switching to the Bitshares blockchain from Bitcoin. Bitspark believes Bitshares decentralized exchange has some clear advantages, particularly for the remittance business.
The new payment method will be rolled out slowly for specific currency pairs so that Bitspark’s remittance users will have the access to all of the worlds 180+ currencies within the next 12 months. Existing bitcoin deposits and payment methods will still persist for a time while Bitspark makes the switch.
Below you can read about some of the reasoning behind why the company is making the switch and why it is their belief that decentralized pegged cryptocurrencies are a major step forward in the remittance world.
Bitspark said that for most of this year the prevailing wisdom for elevated Bitcoin network fees has been “just pay more fees” which is not reasonable when there is no predictability or when margins for payments on a $200 transaction can be wiped out on a $3 fee. Using dynamic fees also does not work as a value proposition for users. When a customer does a remittance, trustworthiness is not gained by telling them “one day your fee might be $1 another day it could be $3.”
Why Bitshares
As things stand currently, the Bitspark team believes Bitshares offers the greatest advantages to a remittance company looking to utilize cryptocurrency as a means to send money quicker, cheaper and to more locations. Bitspark will be aiming for 180+ currencies, instant payments, no cost and zero counterparty risk.
The ability to access the worlds 180+ currencies gets hard past about 30 currencies. Often this requires money transfer providers to open accounts all over the world in different jurisdictions, connect to disparate and often unreliable payment mechanisms which are all intricately different in every country. This leads to it being virtually impossible for a payment provider to connect to everything on their own and instead is forced to connect to the few gatekeepers who do have some semblance of a connection to a payout network.
The problem to solve is access. Bitshares enables anyone to create a pegged crypto asset and trade it on their decentralized exchange, not only is the asset itself decentralized with no counterparties but also when you trade that asset with others there is no counterparty risk at the exchange level too. This is important for a few reasons. First, there are no counterparties to create the asset which means no risk of bank account closure or bank correspondent account closure which is the biggest issue in remittances globally at the moment. There is also no counterparty risk when trading, which means there is no need to keep money at a centralized exchange or broker which can go down, get hacked, become insolvent or run away with money.
Creating a pegged asset without needing to trust an intermediary who says they have the money backing it and instead, the money and value backing it is in a smart contract on the blockchain transparent to everyone. With Bitshares, anyone can create a pegged asset for anything, for every currency or commodity opening up possibilities for new companies and markets. The Bitshares blockchain can solve the problem of access as there is no need to hedge USD and rely on a single gatekeeper. Once people can settle between one another in their native currency and with new money transmitter providers they can directly trade/access liquidity in various FX pairs that were virtually non-existent previously.
Cheap and Fast
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. Additionally, the Bitshares blockchain has been fully functioning for 2+ years and has passed its testing stage as a viable blockchain.
Being able to send individual transactions for a low cost quickly can reduce capital outlays as instead of sending a bulk amount of bitcoin to a liquidity provider and drawing down on the balance, payments can be made as and when they come, freeing up capital for other things.
Next Steps for Bitspark
The company will transition to the Bitshares blockchain for the rest 2017 and will be fully operating in time for Bitspark’s most recent project with the United Nations in Tajikistan where Bitspark will be facilitating domestic and international transfers. Bitspark hopes and believes that the Bitshares blockchain will be able to apply some of its benefits to the context of Tajikistan whereby previously inaccessible exotic currencies such as the Tajik Somoni can be transformed with Bitshares technology and lead to a cheaper, more secure, faster and trustless system of payment.
Source: https://www.cryptoninjas.net/2017/08/11/bitspark-switching-bitcoin-bitshares-remittances/