PYMNTS.com recently interviewed Apifiny CEO, Hoahan Xu, and published a feature covering the launch of Roxe Instant Settlement Network and describing how Roxe facilitates real-time clearing and settlement of cross-border transactions with Blockchain Technology.

The Article, “Easing Banks Into A Cross-Border Payments Paradigm Shift,” discusses why Mr. Xu believes the time is now for the global payments ecosystem to begin shifting from an account-based paradigm to a token-based one — and how the company plans to overcome the challenging inertia of legacy infrastructure that prevents so many financial institutions (FIs) from embracing innovation.

The article explains how the presence of too many intermediaries involved in the traditional correspondent banking model and the negative impacts on time and expense.

“According to Xu, the tallest hurdles lie in the actual clearing and settlement of transactions, with each currency relying on its own real-time gross settlement (RTGS) system. When an FI is not directly a part of that system, it relies upon an agency bank that is. The result is a disparate chain of middle-men that limits transparency and speed of cross-border transactions, while adding costs to customers resulting from FIs’ need to hold reserve funds in multiple currencies at other institutions.”

PYMNTS.com goes on to explain how, using blockchain technology Apifiny’s settlement network, Roxe, aims to settle a range of asset classes including the U.S. dollar (USD) and digital currencies. The technology uses smart contracts in the form of what Roxe calls smart ownership proof, settlement notes that hold the asset itself.

“Banks can have smart ownership proof that mirrors the underlying asset,” Xu explained. “When banks send money to each other, they can send ownership proof to correspondents on the Roxe chain; when they receive smart ownership proof, they can immediately verify that it has underlying USD, for example, and they can go to any settlement node and redeem that USD.”

The article compares the approach of Roxe to that of Ripple, and concludes with a discussion about the path to adoption of new fintech technologies.

 

Read the Full Article: Easing Banks Into A Cross-Border Payments Paradigm Shift