According to a Binance report, blockchain technology is set to transform the global payments landscape by addressing inefficiencies in traditional financial systems. 
The Binance research report <a href="https://public.bnbstatic.com/static/files/research/blockchain-payments-a-fresh-start.pdf" target="_blank" rel="">highlights</a> that while current payment methods, such as <a href="https://crypto.news/tag/Visa/" data-type="link" data-id="https://crypto.news/tag/Visa/" target="_blank" rel="noreferrer noopener">Visa</a> and <a href="https://crypto.news/tag/Mastercard/" data-type="link" data-id="https://crypto.news/tag/Mastercard/" target="_blank" rel="noreferrer noopener">Mastercard</a>, offer the convenience of near-instantaneous payment authorization, actual settlement times often lag, sometimes by several days. 
This delay is especially pronounced in cross-border transactions, where communication between banks in different countries can extend settlement times. 
In contrast, blockchain-based payments offer near-instant settlement. The report cites a 2021 pilot conducted by Visa and Crypto.com in Australia, where the use of USDC (<a href="https://crypto.news/price/usd-coin/" data-type="link" data-id="https://crypto.news/price/usd-coin/" target="_blank" rel="noreferrer noopener">USDC</a>) and the Ethereum (<a href="https://crypto.news/price/ethereum/" data-type="link" data-id="https://crypto.news/price/ethereum/" target="_blank" rel="noreferrer noopener">ETH</a>) blockchain allowed cross-border transactions to be settled in a fraction of the time traditionally required. 
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<h2 class="wp-block-heading" id="blockchain-payments-are-cheaper-than-traditional-means-of-payment">Blockchain payments are cheaper than traditional means of payment</h2> 
The report highlighted some of the cost advantages of <a href="https://crypto.news/tag/blockchain/" target="_blank" data-type="link" data-id="https://crypto.news/tag/blockchain/" rel="noreferrer noopener">blockchain</a> payments. Traditional remittance services charge high fees, particularly in regions like Sub-Saharan Africa, where the average cost of sending money is 7.73%.&nbsp; 
Using blockchain for payments is becoming increasingly popular due to its significantly lower costs compared to traditional methods. 
By comparison, blockchain networks like Solana (<a href="https://crypto.news/price/solana/" target="_blank" data-type="link" data-id="https://crypto.news/price/solana/" rel="noreferrer noopener">SOL</a>) enable transactions at a fraction of the cost. Sending <a href="https://crypto.news/tag/stablecoin/" data-type="link" data-id="https://crypto.news/tag/stablecoin/">stablecoins</a> via Solana incurs minimal fees, often amounting to just a fraction of a cent. 
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<h2 class="wp-block-heading" id="stablecoin-popularity">Stablecoin popularity </h2> 
Stablecoins have become essential for blockchain payments, with the market settling over $10.8 trillion in transactions in 2023, according to the report. When excluding automated activities, the figure is $2.3 trillion. 
<figure class="wp-block-image is-resized">
 <img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcrKsgLIbfNMZ2KL5ACElVAo-kAZV9Q7bpE5VtD4q5iNDiUiGaLNl5jucymizMI5CTaXXEl2mbpCPPF05r4SQ0sv9K3bh_5WgFF6EwbWhEnOGPAQcxovyAALp3Y0arjO44L-A95smYgATLloLqkxbkhJcnP?key=I442x8wIwi_LrQo2Jc6hpw" alt="Report: Blockchain is poised to overhaul global payment systems - 15" style="width: 100%;height:auto">
 <figcaption class="wp-element-caption">
 Source: Coinbase, Binance Research, as of August 2024
 </figcaption>
</figure> 
The stablecoin market has grown steadily, with a combined market cap of over $160 billion, led by Tether (<a href="https://crypto.news/price/tether/" data-type="link" data-id="https://crypto.news/price/tether/">USDT</a>) and USDC, which dominate 73% and 21% of the market, respectively. 
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<h2 class="wp-block-heading" id="challenges-in-blockchain-infrastructure">Challenges in blockchain infrastructure</h2> 
The report noted that current blockchain infrastructures have their challenges. Scalability <a href="https://crypto.news/exclusive-experts-on-zero-knowledge-proofs-as-the-future-of-blockchain-scalability/" target="_blank" data-type="link" data-id="https://crypto.news/exclusive-experts-on-zero-knowledge-proofs-as-the-future-of-blockchain-scalability/" rel="noreferrer noopener">remains</a> a key issue, with even the most advanced blockchains like Solana struggling to match the transaction processing speeds of established payment networks.&nbsp; 
Solana, the report reveals, has experienced multiple outages since its launch, raising concerns about the reliability of blockchain technology for large-scale institutional use. 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 “Since the mainnet launched in 2020, Solana has experienced 7 major outages which brought block production to a halt, with the latest occurring in February 2024. Such growing pain problems would understandably cause institutions to be cautious about relying on blockchains for key business operations, such as payments.” 
 Binance 
</blockquote> 
Despite these challenges, the report suggests blockchains <a href="https://crypto.news/blockchain-technology-is-the-key-to-grassroots-financial-freedom-opinion/" data-type="link" data-id="https://crypto.news/blockchain-technology-is-the-key-to-grassroots-financial-freedom-opinion/" target="_blank" rel="noreferrer noopener">offer a promising alternative</a> to traditional financial systems. Their transparency and decentralized nature <a href="https://crypto.news/visa-tests-usdc-settlement-payments-on-solana-blockchain/" data-type="link" data-id="https://crypto.news/visa-tests-usdc-settlement-payments-on-solana-blockchain/">foster greater trust and security</a> in financial institutions, qualities that are increasingly sought after in a global financial system where centralization and control can be exploited for geopolitical purposes. 
Looking ahead, the report envisions a future where blockchain technology plays a central role in global payments, particularly remittances.&nbsp;As the technology matures and regulatory frameworks evolve, businesses and consumers may increasingly opt for blockchain-based transactions over traditional methods.&nbsp;

Report: Blockchain is poised to overhaul global payment systems

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