Case study

IBM Leverages Stronghold's Blockchain Infrastructure to transform payments

Instead of waiting 3-5 days to clear and settle, IBM World Wire transactions that use Stronghold resolve in real time...

Results

IBM and Stronghold create a virtual payment network, IBM World Wire, to facilitate real time cross border payment transactions for a close looped network of financial institutions. Instead of waiting 3-5 days to clear and settle, IBM World Wire transactions that use Stronghold resolve in real time...

The Challenge

The internet has revolutionized how we share data, but the ways banks exchange value haven’t changed in decades. The result? Cross-border remittance fees average 7.1%, transactions can take days — sometimes weeks — to settle, and approximately 1.7 billion adults still lack access to financial services.

Every business and consumer eventually faces the limitations of the correspondent banking system, where senders and recipients are at the mercy of multiple intermediaries and patchwork regulatory requirements. Each hop in a cross-border transaction raises the potential for exchange rate loss and security hiccups, and nostro accounts tie up almost $5 trillion in capital that could be put to use elsewhere, particularly in developing nations.

To satisfy KYC/AML requirements, IBM sought financial technology with a robust regulatory and compliance framework that also enabled real time settlement.

The Solution

Instead of waiting 3-5 days to clear and settle, IBM World Wire transactions that use Stronghold resolve in real time. Because each unit of value is tracked discretely and publicly, Stronghold’s USD settlement vehicle is safer than cash. At launch, IBM World Wire included 47 currencies in 72 countries, with more than 1081 unique currency trading pairs.

Why did IBM Blockchain make Stronghold USD the first U.S. dollar settlement vehicle for a cross-border payments network that spans more than 70 countries?

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