IBM and Stellar Could Challenge Ripple in the Global Payment Industry

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Both IBM and Stellar could be challenging Ripple’s intention to become a leader in the global payment industry. IBM has recently launched a program that allows consumers and merchants in the South Pacific region to make cross-border payments. Nevertheless, IBM is using Stellar Lumens (XLM) rather than other projects such as Bitcoin (BTC) or Ripple.

Stellar Powers IBM’s Payment Network

Ripple seems to be one of the best-prepared companies to be competing against the SWIFT system. Ripple and its products could provide fast, secure and cheap ways to perform cross-border payments. However, Ripple is not alone in the market.

IBM has decided to use the Stellar network to offer payments across borders. However, Stellar was chosen after being compared to other networks such as Bitcoin and Ripple itself. According to IBM, they have decided to work with Stellar because it has a non-profit status, it is scalable, it has a professional team, it provides token ownership transparency and it has the ability to support any asset type.

Jo Lang, IBM Offering Leader at IBM Blockchain Financial Solutions, commented:

“Lumens are managed by a non-profit. All of the ownership is public and transparent. To us, particularly going to bunches of banks around the world, it seemed like the only option.”

The teams behind Stellar and IBM will be working in order to change the 40-year-old fragmented system that is currently working. In this way, it would be possible to make it more fair and equitable for all.

Moreover, the IBM has partnered with Stellar in other issues as well. For example, IBM’s stablecoin known as Stronghold USD is currently operating on the Stellar blockchain.

“The token allows folks to do payments, foreign exchange between companies in a very seamless and frictionless and more secure way,” said Stronghold founder and Chief Executive, Tammy Camp.

Furthermore, moving funds around the world has become a very costly and inefficient way to do. Banks must have reserves of currency for each country that they are working with. This is clearly costly for consumers. Higher maintenance and operative costs are later translated in higher fees for users.

With IBM’s program – which is known as the IBM Blockchain World Wire – banks can transfer funds using Lumens (XLM). This is the native currency of the Stellar network. This is similar to what Ripple is doing with its xRapid product, that uses XRP to perform transactions.

With the IBM World Wire, users will have real-time payment settling between countries at almost no cost. Furthermore, companies will not have to maintain costly foreign currencies in nostro and vostro accounts.

At the time of writing, XLM is the fifth largest virtual currency in the market. It has a market capitalization of $4.89 billion dollars and each XLM coin can be bought for $0.258 dollars.


Carlos is an international relations’ analyst specializing in cryptocurrencies and blockchain technology. Since 2017, Carlos has written extensively for UseTheBitcoin and other leading cryptocurrency sites; with over 2,000 articles published.