Why even talk about payment decentralization? Isn’t the current payment flow performing well?
Payments in their current state represent a completely centralized solution, where a handful of central authorities oversee all money flows around the globe. These global intermediaries control how and when almost all financial assets are handled and what kind of fees are charged for every transaction.
Conflicts and political instability can cause a banking crisis and the fragile financial system can easily start breaking down. When bank runs start, central authorities need to protect their existence and they have done that multiple times by limiting people’s access to their individual funds.
Payment decentralization could offer a safe alternative to the current system by giving people the chance to store and handle their own funds through the most transparent and safe technology that we know today - the blockchain.
Solution lies in payment decentralization
Blockchain technology offers a more transparent alternative to centralized financial organizations as it gives individuals full ownership and control over their own funds. Its core structure makes it almost impossible to hack or alter, which means it is one of the safest spaces to hold your assets.
Here is how you can benefit from blockchain payments:
Full transparency and traceability: All on-chain transactions can be viewed on the blockchain at any given time. Before a transaction is added to the blockchain, it needs to be verified and confirmed by a network of nodes. Once on the blockchain, no one can alter it and it becomes visible to all.
100% ownership: Blockchain technology ensures 100% ownership through private keys, which means no one can access your funds without your approval.
Lower fees: Blockchain transaction fees depend on the selected chain. Chains that were designed for mainstream use and everyday payments tend to charge very low fees.
24/7 services: Blockchain functions 24/7, which means users can perform transactions at any time and anywhere. All they need is internet access and they are good to go.
Access to financial services: Blockchain payments offer a viable alternative to residents from unbanked countries. Users can store their assets in one of the non-custodial wallets and perform transactions via blockchain, completely bypassing the banking infrastructure.
Easy peer-to-peer transfers: Individuals or companies can easily send funds internally or abroad without high transaction costs or opening hours limitations.
A brave new world of decentralized payments
Depending on which part of the world you live in, one could argue that the current approach to payments is good enough and we should not tamper with it. But as soon as a conflict, high inflation or any other monetary turbulence occurs, the trust in central authority weakens and decentralization starts to sound quite tempting.
Blockchain payments offer decentralization, removing the intermediaries and ensuring quick, secure, affordable, and transparent payment processing. Providers who enable blockchain payment processing are developing all-in-one solutions that not only process payment transactions but also perform analytical overviews, analysis, accounting and tax reports and more.
Centralized payments are not going away anytime soon. But just for a second, let’s imagine a world, where you can go to the local grocery store, carrying only your smartphone, no wallet, paying for your groceries in virtually any currency - euros, dollars, francs, crypto or even the store’s loyalty points. As soon as you pay, the merchant gets his payment instantly in his desired currency, bypassing all intermediaries. Now how does that sound?
More on the topic soon.
Join the GoCrypto community on Telegram!