Case 40: Blockchain Can Achieve Real-Time Payments On An International Scale

To achieve real-time payments on an international scale, there will be a need to introduce foreign exchange (FX) market makers to the blockchain network. They will perform currency conversions on transactions between consumer bank accounts. Central bank participation on the network in a market maker capacity would also be needed between payment service providers in different currency jurisdictions. In this way, real-time payments could potentially be achieved on a cost-effective basis.

The foreign exchange market alone averaged more than $5.3 trillion per day in 201321 and has been increasing at a steady rate each year. The World Bank estimates that the global flow of remittances will reach a total of $610 billion (See table for Scandinavian numbers). Both of these huge markets can be improved in terms of speed and efficiency through asset-centric blockchain technology, which could form an alternative to the current systems which involves various payment service providers and clearing and settlement structures.

Country Remittances
paid in $bn
(2013)
Remittances re
ceived in $bn
(2013)
Norway 5,78 0,79
Sweden 1,16 3,96
Denmark 3,06 1,22
Europe 109,40 36,50

Table: Remittances outflow and inflow in Scandinavia and Europe