Major South Korean bank Shinhan announced on Monday that it has completed its trial of a proof of concept (PoC) specializing in international remittances using stablecoin built on the Hedera Network.
— Hedera (@hedera) November 29, 2021
With this proof of concept, the parties verified the feasibility of issuing and distributing stablecoins using the Hedera Token Service (HTS) and Hedera Consensus Service (HCS). The project aimed to find solutions to the otherwise traditional International remittance system that “typically suffers from high fees, longer waits and absence of tracking feature.”
In the future, Shinhan Bank plans to issue stablecoins backed by the Korean won, and affiliated banks will respond with stablecoins backed by the currencies of their respective countries. Hedera has claimed that an average transaction fee on its network ranges around $0.0001, with just 3-5 seconds of transaction time.
Hedera Hashgraph CEO and co-founder Mance Harmon commented in the press release:
“International remittances were a massive market of $702 billion in 2020, with $539 billion going to low- and middle-income countries. There is a massive opportunity to cut out the middleman and make this process dramatically more efficient and cost-effective, getting the most money possible to people who often need it urgently.”
Meanwhile, Shinhan has maintained caution on its part and said it will launch cross-border payments offering after reviewing the related frameworks and laws.
Shinhan Bank became the first South-Korean bank to promote the use of blockchain technology, and announced its participation in the Hedera Hashgraph Steering Council in April this year. At that time, the bank announced that it would improve the efficiency of business processes by utilizing Hedera’s network infrastructure.