Tradeshift Uses Ethereum’s Network To Speed Up Cross Border Payments And Reduce Cost In Test Pilot
The fintech startup Tradeshift says they have been using the Ethereum (ETH) blockchain in order to process cross border transactions. This allowed the firm to reduce costs and make payments between buyers and suppliers faster and more reliable.
Tradeshift Works With Ethereum
Blockchain technology has been expanding in the financial technology market and it has been offering new solutions to companies and firms. In this case, the supply chain fintech company called Tradeshift has been using Ethereum’s public blockchain in order to reduce costs and improve the reliability of cross border transactions made between parties.
In order to do so, the company has been representing invoice values as tokenized IOUs called FlowTokens that were used by both buyers and suppliers. This allowed them to easily make the transfers that were then settled using on-chain fiat currency.
These tokens are very useful for financial firms and other banking companies that would have better solutions to make cross border transactions. Moreover, this token could certainly be used to improve the supply chain management industry.
Earlier this year, Tradeshift worked with Monerium in order to generate an electronic invoice using the Tradeshift platform. By using a smart contract, the transaction was settled in just a day.
There are several governments that are analyzing the possibility to issue Central Bank Digital Currencies (CBDCs) that could be used in the future to make transfers between individuals, companies and other parties. However, there are still some challenges that central banks need to face before being able to release these CBDCs to the general public.
The main benefits of these e-currencies are related to cost reductions and improved payment services for companies. Depending on the jurisdictions and means of payment used, fees and settlement times widely change and affect the way in which financial companies handle their transactions.