Will Blockchain Technology Revolutionize Global Payments System?
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Payments are synonymous with a transaction that is guaranteed by a central authority which can be a bank, a payment wallet or an escrow service. Keeping the chronological timeline under consideration, blockchain happens to be at the helm of technological advancement in the financial domain. It promises to address some of the pressing problems of current single-point based transaction systems as the number of transactions are increasing at an exponential scale. As correctly quoted by Bob Greifeld, Chief Executive of NASDAQ
“Blockchain technology continues to redefine not only how the exchange sector operates, but the global financial economy as a whole.”
Major advantages of blockchain is this sphere includes:
a) Real Time: It enables settlements in real-time thus reducing risk and charge-backs.
b) Distributed Ledger Technology: A ledger in chronological order that is a computational proof of transactions validated by multiple nodes.The nodes have the benefit of getting small transaction fee which is a fraction of what conventional systems charge currently.
c) Resilient Transaction System: Since there is no single point of failure and it is impossible to censor / erase transactions, it makes blockchain a preferred means of transaction
In this context we wish to systematically see the various use-cases in the financial system where blockchain is poised to deliver groundbreaking reforms :
Corporate Payments Settlements
Corporate payments is a $200 Billion industry with cross-border transactions being in trillions of values. BCG estimates a global growth in cross border payments at compounded annual rate of 10.2% .The current system involves use of an intermediary bank apart from two major parties that are involved. It makes the process slow, inefficient and costly for the participating entities and at this stage Blockchain assumes prominence.
Bitcoin is no longer a buzzword anymore. There is an entire ecosystem replete with trading exchanges, payment systems and even ICO’s working on record levels of transactions. In August 2017, it surpassed Paypal and Netflix  in market-cap and has generated strong defendants and opponents in the business horizon. Other currencies based on blockchain called ALTCOINS are also on the rise and are prone to aggressive speculation over their intrinsic value.
Recently internet is abuzz with China banning ICO’s (Initial Coin Offering) where tokens (the share equivalent of digital assets) can be bought by digital currency owners in anticipation of growth in future value. It has surfaced recently with many tokens completing their ICO’s in a matter of hours and to gain further clarity I had a coffee chat with the CEO of Worldcore, Mr. Alex Nasonov , in the recent Blockchain event held in Dubai. Alex was willing to share his knowledge of ICO’s and how Worldcore aims to be a leader in this Arena.
Me: Hi Alex , It’s great to have you here today !
Alex: Thanks , I believe we will be brewing a lot of information along with coffee .
Me : Sure ! So Alex , Can you summarise what is an ICO and what value does it hold for an investor?
Alex : Surely. ICO’s has been touted as democratising technology by the masses . Now people can directly participate in developing those technologies which they believe will add value in the future unlike being bombarded with technology from large corporations that have so far focussed on incremental upgrades and minor changes.You will see ICO’s giving some really innovative options that aim to eliminate current technological bottlenecks pertaining to storage, data-sharing , processing etc. using Blockchain as the underlying technology.
Me : So do you think all of these promises will be fulfilled as people are crowdfunding their digital assets on promises ?
Alex : You are right in certain aspects pertaining to surety of these services. However most of them have reached a certain level of validation , with substantiated proofs of concept and whitepapers in their defence. However just like stocks , the intrinsic value of the token is subject to public sentiment towards the proposed technology which happens to be in the digital space or the Wall Street.
Me: I agree ! But what do you think are the core points an investor should look out before investing in an ICO ?
Alex : Surely , there are multiple check points which must be checked before investing . The major ones I would suggest are :
• Strong development team
• Prior Experience in Domain
• Business and software evaluation by one of the largest consulting companies
• Qualified advisors and Management Team
Me: Can you elucidate upon Worldcore and what is it upto?
Alex : Well Worldcore has been working in the financial service industry since 2015 on multiple products that include prepaid debit cards , fintech media , invoice management and now having seen the potential of blockchain , we have ditched the conventional IPO’s and launched an ICO as we plan to rapidly expand in the blockchain arena. We have put together a comprehensive plan , backed by our strong profitability in the past and audited report for people to refer and invest in us.
Me : Do you think that ditching the IPO was a very risky step , given the $100M+ size and scope of your business ?
Alex : Not at all. Infact not having an ICO was a more riskier step as not only in terms of investment volume , ICO also helps to gauge customer’s faith and sentiment in our endeavours.
Me: True That ! So coming to the final question, how much did you raised and what are the timelines for the worldcore ICO ?
Alex : Our ICO is already successful as we have raised $10m + our business was evaluated by E&Y Valuations division with over $30m value. We aim to close our ICO on 14th of November this year. You can find further details on our website (worldcore.com).
Me: All the best Alex. Congratulations for your successful ICO.