• Friday, June 21, 2024
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Overcoming Cross-Border Payment Hurdles: How Web3 is Transforming Payments

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In today’s world, technology has erased geographical boundaries, transforming the global economy. E-commerce, as highlighted in the 2022 Paypal Borderless Commerce Report, has witnessed a surge in cross-border transactions.

The report predicts that global e-commerce will reach $7.4 trillion by 2025, with 57 percent of online shoppers buying from foreign markets in 2022. This borderless trend is particularly evident in emerging economies like Africa, where initiatives like the Africa Continental Free Trade Area (AfCFTA) promote and enhance cross-border trade.

The global economy’s borderless nature is amplified by the rise of remote work, which is steadily increasing worldwide, especially since COVID-19. Currently, 12.7 percent of full-time employees work remotely, which is expected to surge by 2025. This growth will lead to more cross-border payments in the corporate world.

Additionally, the global workforce is becoming more borderless due to organizations prioritizing diversity and inclusion. The World Economic Forum’s Future of Jobs Report found that 92% of 803 surveyed companies have DEI programs to diversify their employee base.

Read also: Web 3.0 will drive innovation, reshape industries, empower African businesses – Ebanehita

The global freelance ecosystem is booming, with approximately 1.57 billion freelancers worldwide in 2021 (46.7 percent of the global workforce). By 2027, it is expected to reach $9.19 billion, growing at a 15.3 percent CAGR since 2017. This trend and other factors are reshaping the economy, necessitating more cross-border payments and changing how we conduct international transactions.

Due to intermediaries, traditional cross-border payments face challenges like opacity, fraud, high fees, and slow settlement. Web3 payments offer transparent, secure, fast, and global transactions, making them ideal for cross-border transactions. The market grew from 3.2 billion USD in 2022 to an expected 39.8 billion USD by 2030, with 75% of US businesses planning to adopt it in two years.

However, Web3 payments can be complex and costly for smaller businesses. Fuse Network simplifies Web3 payments with user-friendly APIs, democratizing access for small and medium-sized enterprises.

Established in 2019, Fuse Network addresses high fees, security risks, and lengthy settlement times, making it an attractive option for businesses and consumers involved in cross-border transactions.

Eliminating High Transaction Fees

Fuse Network’s Web3 payment infrastructure revolutionizes the payment landscape by eliminating traditional transaction fees. Instead, it charges less than a cent per transaction, benefiting businesses, especially SMEs, by maintaining their financial health and profitability.

Protecting Cross-Border Transactions

Fuse Network enhances cross-border transaction security with advanced cryptographic techniques, minimizing the risk of fraud and unauthorized alterations. It employs a robust delegated proof-of-stake consensus mechanism and Fuse Smart Wallets for user-owned accounts, providing superior security to traditional systems.

This system ensures that blockchain data undergoes validation by independent validators before any changes, guaranteeing data and transaction integrity. Validators are selected based on their stake in the network, reducing the risk of manipulation. Fuse’s nodes actively maintain and update smart contracts, further enhancing security.

Shortening Settlement Periods

Fuse Network’s Web 3 payment infrastructure, powered by blockchain technology, addresses the time-consuming settlement periods in cross-border payments. With a 5-second block time, it processes transactions swiftly, handling up to 60 transactions per second for ERC-20 assets and an impressive 120 transactions per second for Fuse-based tokens.

This efficiency reduces costs and appeals to businesses, especially those involved in cross-border trade. Fuse Network’s commitment to cutting-edge solutions enhances financial operations for businesses, making it a valuable choice in today’s global economy.

Ira Lakhman is the COO of Fuse.io