IBM and Stellar Team up for South Pacific Blockchain Banking Effort

Blockchain technology continues to make inroads in many different sectors as we speak. One of the companies actively exploring this technology goes by the name of Stellar. It is best known for trying to rival Ripple in the blockchain banking industry. The company is now actively partnering with IBM to promote the benefits of blockchain banking applied to cross-border payments.

Stellar and IBM Make for an Interesting Partnership

Although a lot of people are familiar with the concept of Stellar, the company hasn’t been making much noise lately. Most of the work is taking place behind the scenes when it comes to developing blockchain solutions. It also completed a few airdrops of its Lumens currency over the past few months to get its tokens into the hands of as many people as possible.

With this new partnership with IBM under its belt, things are looking up for Stellar. Considering how banks have lately started to embrace blockchain-based solutions, it is time we see some more competition emerge in this space. It appears the South Pacific region will be worth keeping an eye on moving forward, as this is where Stellar and IBM will try to make a stand in the coming months.

IBM has been an active party in the world of blockchain technology as of late. This is one of the first instances in which it has looked to enter the financial sector, though. In this case, it aims to make it more convenient for merchants and consumers to send money across borders in near-real time. Additionally, both companies will try to reduce the fees associated with this process. It is an effort certainly worth exploring, as there is a growing need for cheaper and faster global money transfer solutions.

So far, it seems a total of twelve banks are on board for this new blockchain-based venture. It is a good start, although there are plenty more financial institutions across Australia, New Zealand, and the South Pacific region which aren’t on board just yet. Both companies are confident this trial is the next logical step in the evolution of blockchain technology. That’s an ambitious outlook, although it will be good to see more focus on blockchain banking in general.

It is somewhat surprising to see IBM acknowledge the role of digital currencies in blockchain banking. Lumens will facilitate these cross-border payments. It’s a remarkable decision on IBM’s part, considering Ripple seems to be well ahead of Stellar in this particular industry right now. Right now, banks use foreign accounts in local currency to complete such cross-border transfers. It is a very slow and expensive process which ultimately ties up capital.

With this new partnership, IBM and Stellar are confident they can conduct cross-border payments without tying up capital and settle transactions in minutes. It is expected the banks will only use Lumens as a temporary measure, depending on how things go in the long run. Rest assured we will see central bank digital currencies make an appearance at some point in the future.