The adoption of blockchain-based global payments is reaching critical mass this year, and organisations worldwide are already looking to incorporate digital assets into payment flows.
That’s a key takeaway from Ripple’s first Blockchain in Payments Report, unveiled on day two of its Swell 2018 conference, which drew to a close yesterday. “There’s a lot of money at stake,” commented Cory Johnson, Chief Market Strategist at Ripple.
Data from The Boston Consulting Group (BCG) puts the size of the global market for cross-border payments volume at $27 trillion. Another $20 trillion in growth could be up for grabs between 2018 and 2026. Combine this with recent data from the World Bank suggesting global remittances alone will reach $642 billion this year.
Johnson added: “The world is used to getting things, right now, on-demand. They aren’t waiting for anything. When we look at blockchain and the solutions it offers in cross-border payments, we have an opportunity to address their needs.”
So many questions
Blockchain and digital assets offer a way to modernise today’s international payment rails and make sending money across borders as fast, easy, transparent and reliable as it is to move information. But many questions remain: When is blockchain going to be mainstream? How close are we to the tipping point? What is the outlook on digital asset use for settlement?
Alenka Grealish, Senior Analyst for Corporate Banking at Celent, explained that, for the aforementioned report, nearly 700 global payments professionals across industries and in 22 countries around the world answered questions to gauge where we are in blockchain adoption, interest in digital assets and general understanding about the benefits of this new technology.
Grealish remarked that a tipping point was approaching, driven by respondents’ motivation to change the way money moves across borders today. “When you envision the scale with the status quo on one side and the forces of change on the other, we see that the status quo weighs heavy, but the forces of change are starting to dominate — to tip the scale in the direction of change.”
Key highlights from the report included: 18% of respondents are in production or near production for the payments use cases; 45% said they are already in production, piloting or close to signing with a blockchain provider; 75% respondents are extremely or very interested in using a digital asset as a settlement and/or a base currency; 85% of those using blockchain in production and 90% of those quickly moving to production are either extremely or very interested in using digital assets as a form of payment.