The Lightning Network just entered the money transmission game in a major way thanks to a strategic partnership between Bakkt and Lightning Network infrastructure provider, Lightspark. The collaboration streamlines international fiat-to-fiat money transfers in a unique way.
Crypto Money Transfer is a Booming Market
The new project seeks to help fill a growing niche in the financial sector. International money transmission is a vital component of businesses around the globe. Companies lose billions every year attempting to send funds globally. These losses originate from conversion costs, fees, and time delays associated with traditional methods of sending funding.
The problem is even worse for individuals. Remittance payments are a valuable lifeline to the families of out-of-country workers. The global remittance market is in the billions. Sadly, the current ways to send funding are very inefficient and expensive.
On average, a remittance payment loses 8-10% of its value from the time it's sent until it's received. These funds get gobbled up by a combination of fees and third parties. Sadly, sending fiat currency requires a lot of people. Some reports place the number of groups involved in a single transaction as high as 36 different steps, with each charging a small fee.
Send and Save
David Marcus, who is spearheading Bakkt’s contribution to the strategy, took to social media to praise the project and share his vision. The new UMA-capable money transfer services will enable anyone to send fiat currency and convert it to local currencies in minutes rather than hours or days.
Marcus believes this is a vital step in driving crypto adoption. His team has worked hard to enable users to save time and money by leveraging the new protocol. Specifically, users can reduce onramping time. Also, there are instant deposits and withdrawals available thanks to the Lightning Networks' capabilities.
Bakkt and Lightspark both bring a lot to the table. Bakkt can provide regulated custody and licensed fiat on and off-ramp option users. whereas, Lightspark provides the infrastructure for the project. Anyone can send fiat internationally and save using these systems in a regulatory-compliant manner. For example, you could send dollars and receive Euros at the destination in minutes. Best of all, the protocol remains fully compliant.
Additionally, the project was built to remain compliant across international borders. This approach makes sense especially when you consider that Bakkt is a publicly traded company that shares audited financials with followers. The firm is registered with FinCEN as a licensed Money Service Business and has transfer licensing as well.
The teams behind the project see their latest development as the perfect solution for the millions of businesses currently taking unnecessary losses due to transfer delays and inefficiencies. This system reduces time and improves transparency for all parties involved. Additionally, it enables these firms to conduct micro-transactions and much more.
Lightning Fast Remittance – Money Transmission
Crypto remittance payments remain an expanding sector of the industry. Digital assets provide many advantages when compared to fiat when discussing international transfers and transactions. As such, this latest development is sure to save businesses money and help further cement the Lightning Network as a crucial tool for international money transfers.