Global digital asset infrastructure firms Stablecorp and Shift Markets are collaborating to establish a cross-border payments and foreign exchange (FX) rail that uses the Algorand blockchain and allows assets to flow between Canada and the United States.
With this rail, cross-border transactions between the two countries can be settled near instantaneously, including on weekends, rather than taking the average three to five days. Additionally, total fees and spreads can be reduced by as much as 95%, Stablecorp estimated in a Monday (Oct. 3) press release.
“Digital assets have been held up as a cure-all for financial friction, but until now we haven’t put in place these types of connected, ecosystem driven solutions that enable individuals and companies to truly monetize these friction reductions,” Stablecorp President and CEO Alex McDougall said.
One of the first partners to leverage this rail will be the Canada SailGP Team that competes on the international SailGP circuit. The team will use it to pay athletes and suppliers, according to the release.
To enable cross-border payments, the team will use Stablecorp’s newly-launched treasury management platform, Grapes Finance, to convert Canadian fiat into Stablecorp’s Canadian stablecoin QCAD.
Then, Shift Markets’ on-chain FX platform, Cables, will convert this QCAD into USD Coin (USDC) or Euro Coin (EUROC). The USDC or EUROC, in turn, will be settled through Circle’s payment infrastructure, the release stated.
Read more: Stablecorp Beta Launches Blockchain-Based Treasury Management Platform
“There is such a large need and lack of resources for cross-border payments and foreign exchange on-chain,” said Cables Finance CEO Ian McAfee. “By partnering with Stablecorp, we are taking some of the foundational steps in creating fast, secure and cost-effective infrastructure to propel this financial ecosystem onto the blockchain.”
PYMNTS’ research has found that 50% of firms currently use or would like to use blockchain and cryptocurrency for cross-border payments.
See also: 37% of Firms Use Blockchain, Crypto for Cross-Border Payments
Thirty-seven percent of the businesses surveyed said they are currently using blockchain and cryptocurrency for cross-border transactions, while another 13% said they would like to do so, according to the “Blockchain Payments Tracker,” a PYMNTS and Algorand collaboration.
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