Big Firms, Startups Drawn to Blockchain Technology (March 16, 2015)
The value of bitcoin at around $300 is a far cry from its 2013 peak of more than $1,000, but blockchain—the underlying technology that serves as a record of all bitcoin transactions—is garnering a lot of attention.
IBM has been considering using blockchain to create a digital cash and payment system for currencies that would save on transaction costs and enable consumers to instantly transfer cash or make payments without a bank or clearing party, according to Reuters. IBM also has reportedly held discussions about a blockchain cash system with several central banks, including the U.S. Federal Reserve. The proposed digital currency system would be controlled by central banks, an unnamed source told Reuters.
In a February blog post, David Andolfatto, senior vice president and director of research for the St. Louis Fed, described opportunities for what he termed “Fedcoin,” a Federal Reserve-sponsored virtual currency he claimed would solve one of the major problems with bitcoin and other virtual currencies—their high rate of volatility. (The blog is his opinion and not that of the Federal Reserve.)
Meanwhile, a blockchain-based e-wallet and money transfer app for iPhone and Android devices, Abra, will be hitting the market soon. Abra, which is backed by venture capital firm RRE, is an acronym for A Better Remittance App. Abra merges money transfer and payments using an e-wallet, and there are no banks or other third parties involved in managing, storing, remitting or accepting the funds, according to an RRE blog. Abra is launching a network of Abra Tellers, which are like mobile airtime agents but buy and sell digital currency instead of airtime, according to the company. Consumers with supported ATM cards will be able to add digital cash to their e-wallets with their ATM cards and PIN.
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