A Chicago-based neobank startup capitalizing on Bitcoin’s Lightning Network, Zap Inc. has launched native support for EUR, GBP, and CHF on their banking and wallet service Strike – and announced that native support for AUD and CAD will be coming soon.
Smaller Fees For International Currency Exchange
As the first cryptocurrency, Bitcoin is starting to show it’s age, technologically speaking – which is why the Lightning Network was proposed as a solution to the number 1 cryptocurrencies’ scalability issues. It is a “layer 2” payment protocol that operates through a peer-to-peer system in order to make micropayments of cryptocurrency using a network of bidirectional payment channels without delegating custody of funds.
The neobank intends to take advantage of this in order to eliminate the often arbitrary exchange rates used to send money through banks – or fast payment processors like PayPal. Although countries that are part of the SEPA network can often perform banking transactions almost instantly, long delays are part and parcel for many dealing with international transfers.
Jack Mallers – the Chicago-based founder of Zap – stated that the goal of his company remains in line with the original vision of Bitcoin, namely to allow large numbers of people to access the financial system quickly and cheaply.
“This will allow billions of people around the world to access the financial system in a simple low-cost way, fulfilling the original vision and promise of Bitcoin. [..] We can move any physical value anywhere in the world for no variable cost. Transaction finality from one point to another for free.”
Zap are not the first company using blockchain for quicker and easier money transfers. MoneyGram uses Ripple’s On Demand Liquidity (ODL) solutions for some money transfers, although they have denied using it for direct transfer of consumer funds, digital or not.
However, the current predicament Ripple Labs find themselves in may give other blockchain-powered payment methods some time in the spotlight – and it may be Zap’s time to shine.
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