Binance Research Says Blockchain Could Speed Up Payments Global payments are cheaper on the blockchain. Blockchain could revive the slow, expensive fiat banking system.
According to Binance research, Blockchains provide a unified technological landscape that can efficiently streamline the global payments infrastructure and overcome the fragmented nature of the modern banking system. Report.
When a transaction is made using Visa or MasterCard, the consumer experiences almost immediate payment authorization, but the actual settlement of the transaction, the movement of funds from the customer's bank to the merchant's bank, often does not occur until at least a day later.
Settlement times take longer when funds need to be moved across borders, as it requires communication between banks from different countries.
Blockchains are more efficient in terms of speed, with transactions settling within an hour, the report said. It also claims that blockchain transactions are less expensive than traditional transfer methods.
World Bank data indicates that the average cost of sending payments across international borders was 6.35% in the first quarter of this year.
According to the report, blockchain networks like Solana can enable transactions at a fraction of that cost, moving stablecoins for fees as small as a fraction of a cent. Cited Visa pilot project to use blockchains to settle payments.
The report notes that scalability challenges still need to be overcome, as Visa is capable of processing more than 65,000 transactions per second, while Solana, for example, can handle just over 1,000 transactions.
Still, the report concludes, as the global regulatory environment converges, technology advances, and companies grow more comfortable with blockchain technology, many may choose to transact in on-chain stablecoins over the slow, expensive fiat banking system.
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