Singapore and Canada need to solve foreign exchange in their blockchain project for real-time payments.
Foreign-exchange transactions are emerging as the biggest obstacle to a joint Singapore-Canada project to achieve near-instant cross-border payments using blockchain.Read the two numbers from bitcoin pairs, then divide the one into the other to cancel bitcoin. This is the current obvious solution to FX trading congestion.
Since 2016, payments authorities of the two countries have been experimenting with their own use of distributed-ledger technology for domestic interbank payments and settlements. Singapore has its Project Ubin, and Payments Canada has Jasper.
Last year they combined efforts to promote cross-border use, and now they have linked their domestic blockchains using digital fiat as a means of transacting.
In theory, payments can be settled instantly on blockchain. However, this Ubin-Jasper project didn't change how banks get quotes for foreign-exchange transactions, says Naveen Mallela, J.P. Morgan’s APAC head of digital. This means although the transaction can happen in real time, the actual process will still be lengthy.
One could use a series of bitcoin prices in both currencies and run a two channel squeeze against them and develop their generators. Then one could mark both relative skew and ratio.
But it illustrates how sandbox deals with this stuff. One has to find or create a constrained channel to connect two systems, essentially an escrow service. Bitcoin is a fair queueing system, one should always be able to pick off two currency and construct their implied two color channel. A bettable, fixed bandwidth channel is a common solution in many sandbox systems.
This also demonstrates the need for multi-step smart contracts with ledger checks between steps. Either of the two parties may cancel the FX exchange ratio within a defined timeout, assuaging fears of bitcoin volatility.
No comments:
Post a Comment