Fiat Backed Home Grown Cryptocurrency from Wells FargoSeptember 21, 2019
Wells Fargo & Company have come up with plans to launch their cryptocurrency backed by fiat money.
The bank’s international locations would be able to exchange Wells Fargo Digital Cash among their global network enabling the internal book transfers of cross border payments. The bank has already tested the transfers between US and Canadian accounts using the USD.
Lisa Frazier, head of Innovation Group at Wells Fargo stated, “We believe that DLT holds the promise for different use cases, and we are energized to take a significant step when it comes to applying the technology to banking in a scalable and material way.
A smart contract application, which is a kind of business automation software, will be used to support the digital currency exchange process. Since this coin has its intrinsic value tied to fiat currency, its value is based on the supply and demand of virtual money.
Avivah Litan, VP of research at Gartner, stated, “The train has left the station and will start moving the sooner it gains acceleration.”
Wells Fargo is a significant money mover, and currently, they are under pressure to work using the traditional methods of the money transfer system. However, the blockchain would provide for an efficient payment network. The implementations are customized in a way to favor high velocity and highly secure banking data that is private.
The Stable coin is not only for banks, but several giant technology companies are also creating their versions for their customers to store value. Facebook’s Libra is a stable coin and Calibra; a crypto wallet are all examples of the increasing adoption of the stable coin by different sectors.
Facebook has the support of major corporations like eBay, PayPal, Uber, Lyft, Mastercard, and Visa.
Visa has recently launched a debit card, which will permit the transfer of fiat money which has been converted from cryptocurrencies that have been stored in online wallets.
There are nations, which have just a few or no options to open a bank account. They are relying on expensive remittances to transfer money home, mainly if they are working far from their native country.
The Distributed Ledger Technology from Wells Fargo provides for a highly secure record of transactions providing for “near real-time money movement,” which is trustworthy in a way to not affect the underlying account.
The DLT system from Wells Fargo has the potential to provide for real-time financial interactions covering multiple accounts through multiple market places across the world.