A Japanese fintech company has unveiled a system designed to address the price volatility observed when cryptocurrencies are used for remittances.
Atom Solutions says that, at the moment, the options for foreign workers who have to make remittances abroad are imperfect. While costs can be high when they try to complete transactions through a traditional bank, a completely different problem comes to the fore when crypto is used. Because of the wild fluctuations observed on the market – from Bitcoin and Ethereum to lesser known ones – the value of a shed can drop dramatically in a short period of time, which means that the fiat converted into a crypt for a remittance may be worth much less when it is reconverted into fiat at the other end.
This is why the company has developed the equivalent overseas remittance system, which is known as EVOR for short. Atom Solutions believes that this product has the potential to eliminate decades of shortages in this high value sector.
For example, imagine that someone in Japan wants to send money to a loved one in the Philippines. The company's multi-currency portfolio will allow the person making the payment to purchase encryption using the Japanese yen before transferring it to the portfolio of their relatives in the Philippines. This then comes in the local fiat currency, helping to reduce costs by mitigating the risks associated with foreign exchange.
The speed at which this transaction takes place is a crucial factor in ensuring that the value of a remittance is preserved, and Atom Solutions says another advantage is how EVOR offers "the lowest possible cost in the world" in terms of commissions.
A suite of financial services
Atom Solutions says it wants to offer a suite of financial services that extends beyond remittances, all with the intent to make the encryption more practical for everyday use.
He created a new digital asset known as Eternal Coin (XEC). In addition to playing an instrumental role in the remittance process, the platform also intends to allow its community to lend XEC to other users on a peer-to-peer basis. They would have the potential to earn interest on these loans by obtaining a portion of the transaction fees paid by the borrower.
Overall, Atom Solutions states that its remittance concept is something that has never been implemented in the world before. He hopes that his products, along with his multi-currency portfolio and the official exchange system, will help transform the industry for the better.
World Bank data surrounding remittances to low and middle income countries helps to paint a picture of why reform is needed. The independent group recently said that remittances reached a record level in 2017, increasing by 8.5% to reach $ 466 billion in the 12-month period. When you include money flowing in high-income countries, this figure rises further to $ 613 billion, an increase of 7 percent. Regarding the areas where most of the remittances were sent, India, China, the Philippines, Mexico, Nigeria and Egypt are at the top of the list.
The remittances grew further in 2018, the World Bank said, and given how these sums of money often serve as crucial life lines for recipients, Atom Solutions hopes their concept will help them access more of this money without losing money at exorbitant fees.
Atom Solutions is headquartered in Tokyo and the Equivalent Remission System is scheduled for the beginning of March 2019. Users are now invited to try EVOR Simulator before the launch of its official service.
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