Blockchain for Payments (analysis)

BC payments are different because they rely on no middle men. BTC payments are possible without banks and ANY other institution with complete transparency acroos the globe without worrying about exchange rates.

What are the various opportunities to use the technology
BC for payments can be developed in many forms, but they need to consider:
– Legal aspects: the currency can be a cryptocurrency or a legal tender euros or dollars.
– Public or Private BC: open and permisionless vs closed and with permission. Open source benefits vs Privacy benefits. Communities working on the code vs close collaboration networks. Companies must choose.
– Consensus mechanism to validate transactions. From BTC proof of concept (needed in open BCs) to much lighter and efficient methods like the Practical Byzantine Fault Tolerance Mechanism, or PoS.

MAIN CHALLENGES
– High implementation costs
– Technology inmature: the technoly in solution and consumer habits
– Legal knowledge, regulation, etc.

Implications for financiers.

For the technology to be popular it needs to be legal tender. Using legal tender instead of cryptos would make the technology realiable for population. BUT legal tender makes much of the advantages not available.
A solution would be to create tokens to backup the fiat money so people can use legal tender, but the main issue with the foreign exchange rate would remain. Atención aquí: todas las soluciones crypto van demasiado lejos al pretender migrar a la gente directamente al mundo crypto, cuando la solución adoptable de forma masiva tendría que pasar por el uso inicial de moneda fiat que aproveche las ventajas crypto en el backoffice.
Overall benefits of BC payments:
– Eliminate banking backup and staff.
– Reduction of settlement time from days to secs.
– Provide networks for market makers. This would bring more options and smaller fees.
– Lower fees.
– Security.
– Lower currency risks.
– Improved transparency.
– More consumer friendly to pay online without disclosing card information this reducing fraud.
– Cheaper than cross border payments because of low risks (currencis don´t fluctuate much).
– Suitable for small payments. Interesting for making media services granular.
One of the most promising uses are cross border transfers for expats.
Some use cases:
– Abra works like a Uber of cash. Besides people paying and receiving crypto it has a network of people around with cash that can provide with the money. Otherwise receiver can keep it somehere.
– BitPesa. Was create for P2P payments in Africa.
– Ripple uses its own private chain connecting ledgers of banks