Shinhan Bank of South Korea conducted a feasibility test for stablecoin remittance payments using Hedera’s distributed ledger technology.
The project aimed to address cross-border payment issues related to high fees, slow settlement times, and the lack of tracking features. It involved Shinhan Bank, SCB TechX (Siam Commercial Bank’s technology innovation unit), and other financial institutions.
Byunghee Kim, Shinhan Bank’s blockchain leader, highlighted that stablecoins provide an affordable, swift, and dependable method to transfer value internationally. This can enhance financial inclusion and accessibility to financial services for individuals and businesses in underserved communities.
The stablecoin remittance pilot utilizes Hedera’s smart contract capabilities, making it compatible with the Ethereum Virtual Machine (EVM). Hedera stated that stablecoin issuers based on EVM can participate in future pilots using the same tested framework.
Byunghee Kim expressed satisfaction with the next phase of the project, highlighting how Hedera’s EVM-compatible technology eliminates intermediaries, lowers costs, and accelerates the remittance process.
Stablecoins for Global Payments
The World Bank reports an average remittance cost of 6%. Cross-border transfers between countries with limited liquidity and network connections often involve high intermediary fees. These transactions can take three to seven days to process, providing no transaction visibility for customers.
Shinhan Bank asserts that its stablecoin solution enables individuals and organizations to send and receive funds in local stablecoin at significantly reduced fees compared to traditional remittance methods. Byunghee Kim stated that the successful completion of the pilot is a crucial advancement in their mission to make cross-border payments faster, cheaper, and more accessible worldwide.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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