Electronic Internet Payment Systems and Cryptocurrencies

Electronic Internet payment systems for active Internet users have become commonplace, and few of the latter think about their role in the country’s economy and macroeconomics in general. Users of the systems only appreciate their convenience and speed of transactions. Payment through such systems takes from several seconds to half an hour. So, e-commerce participants are looking for reliable, convenient and affordable solutions to attract more customers.

One of the ways to find such a provider is to visit a special international conference in the field of e-commerce called eCom21. Against the background of many “theoretical” conferences, the Riga Forum stands out with its emphasis on the practical aspects of the e-Commerce business. It is here you can meet forum participants — merchants, software developers and vendors, payment systems, processing centers and service providers, technical and tax consultants, auditors from the EU, Russia, Ukraine, Belarus, Israel, USA. If you visit this conference, you will find out about every trend in Digital Banking, Merchant Payments, Crypto Exchange and Banking, and Mobile banking. One of the participants is payment solution provider crassula.io.

Purpose, functions and tasks of payment systems

Global payment systems act as economic means of communication or infrastructure in the global economy. They allow you to organize the movement of cash flows. World payment systems began to be formed simultaneously with the emergence of money — as means of payment and circulation. Today, even in market conditions and free competition, they are regulated by the state.

Principles of organization of payment systems

All major payment systems in the world are subject to general principles and rules.

The principle of manageability is expressed in the transparency and clear structure of the payment system controls.

Also, banking institutions must function within the same legal categories. International electronic payment systems operate under international law. What about crypto banks? Some large crypto banks are seeking official status and obtaining a banking license. However, nowadays, it is possible to work completely legally under a special cryptocurrency license only in Japan. In some other countries, they can get a license only for some services. If a crypto bank works in a jurisdiction where cryptocurrency is recognized as a means of payment, it has a chance to obtain a banking license.

Crypto banks and DeFi products

News about new crypto startups and blockchain projects, including crypto banks, appears almost every week. There is a new trend when traditional banks offer crypto-solutions. Payment system PayPal has already offered a special wallet for cryptocurrencies and introduced digital assets into its ecosystem. And Visa, together with its crypto bank partner, attracts fintech companies, that are using cryptocurrencies in their business, presenting the opportunity to use USD Coin. So, companies working with fiat money and assets can easily participate in a decentralized economy through cryptocurrency banks.

The crypto bank can be a traditional bank that has added cryptocurrency services to its list. These responsibilities include managing cryptocurrencies, storing private keys, and investing in the cryptocurrency portfolio. And decentralized platforms, which combine the features of exchanges, exchangers and p2p lending services, attract more customers.

Cryptocurrency loans and deposits

The most popular DeFi services today are the issuance of loans secured by cryptocurrencies or, conversely, the storage of crypto deposits with interest. The fundamental difference between DeFi lending and traditional banks is that the process of user interaction with the crypto platform is fully decentralized and automated, does not require approval and confirmations from officials and, in theory, anyone can take part in it.

What besides affordability makes DeFi banks so attractive and promising? It is decentralization combined with the reliability of the platform, on which the vast majority of DeFi applications run. Decentralization builds trust in users because it eliminates the possibility of human-related manipulation and abuse. Technologically, the process is provided by the famous Ethereum platform, based on which decentralized systems work like clockwork, thanks to smart contract technology.

All the relevant news feeds are full of headlines that decentralized services have raised hundreds of millions of dollars in collateral and deposits with ETH, and the numbers are getting more impressive every month. It turned out that cryptocurrencies in general can be the basis for the issuance of financial instruments, and the mechanism of their provision under smart contracts inspires confidence in investors.

The new generation of users will be attracted by financial transaction optimization, low fees and safety. But still, there is a matter of governmental regulations – when they will be ready to fully allow crypto banks to work? When the financial regulator steps in, they bring compliance rules, piles of papers and loss of privacy. So you can forget about crypto wallet-to-wallet transactions by a nickname or paperwork absence.


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