IBM’s blockchain division has signed up with six banks to give these financial institutions their own stablecoin. Stellar Lumens (XLM) will function as the bridge between these six separate projects. All this is part of IBM’s newest product launch of World Wire, an initiative to revolutionize the current banking system through the Stellar blockchain.
Among the banks that are part of the project, are Philippines-based RCBC, Brazil’s Banco Bradesco, and the Bank Busan from South Korea. In total six banks have already agreed to be part of the program.
It’s likely that more banks will follow, as regulatory clarity is needed for a full scale implementation of World Wire. On a side note, IBM will also integrate the Euro and USD into its currency-backed token system.
It’s likely that each bank will use their own coin for internal international transactions, in the same way that Chase is going to use the JP Morgan (JPM) coin. For transaction between banks, Stellar’s XLM token will be used as a bridge currency from one bank to the other.
The announced by IBM and Stellar doesn’t come as a huge surprise, as rumors have been circulating for several weeks now. Yet, the price of XLM clearly reacted to the news. When the news came out, the price went up ten percent from $0.108 to $0.116. In the last 24 hours XLM has seen 280 million dollars of trading volume, which is a considerable increase from the normal 160 million dollars on a daily basis.
Also published on Medium.