The Bitcoin Lightning Network will be facilitating cross-border fiat payments between the EU (UK and Europe) and Africa.
Crypto trading companies CoinCorner and Bitnob have teamed up to introduce cross-border payment between the European and African continents through the Bitcoin Lightning Network. As a result, users will now be able to send funds from the UK and Europe to select African countries. The application, Send Globally, will use the Bitcoin Lightning Network to send funds in fiat currencies. Under the application, users can send funds in British Pounds (GBP) or Euros (EUR) to the countries of Nigeria, Kenya, and Ghana, where they will be converted into the local currencies of Nigerian Naira (NGN), Kenyan Shilling (KES), and Ghanaian Cedi (GHS). The Lightning Network will automatically convert the funds from GBP or EUR to BTC. They are then converted to the local currency of the African country and directly deposited into the recipient’s bank account or online wallet.
This development bodes well for the crypto industry, struggling in 2022, with crypto prices taking a plunge amidst several firms going bankrupt. Before this initiative, users wishing to send funds across continents only had the option of a third-party, centralized facilitator like Western Union. The issues associated with centralized money exchanges include longer transaction times and higher transaction fees. Considering that the high remittances sent from European countries to sub-Saharan Africa are $40 billion, the transaction fees alone would amount to millions of dollars.
CoinCorner CEO Danny Scott acknowledged the scope of the remittance market and the role BTC can play in it.
He pointed out,
“The remittance market is a huge opportunity for Bitcoin. By partnering with Bitnob to provide a seamless cross-border experience using Bitcoin and the Lightning Network, we hope to remove some of the friction and cost that customers experience when using traditional FX and money remittance companies.”
Sub-Saharan Remittance Corridor
There has been a spur of crypto adoption in the MENA (Middle East and Africa) region, despite the efforts of the IMF to discourage the industry. With the introduction of the Lightning Network, Africans working in the UK and Europe can send funds home without worrying about extended processing times or high percentage cuts.
Bitnob CEO Bernad Parah believes the initiative will significantly reduce the costs of sending funds to the sub-Saharan region.
He stated,
“For us at Bitnob, this is another leap forward in economic empowerment for Africans. Sub-Saharan Africa remains the most expensive region to send money to, where sending $200 costs an average of 8.2 percent in the fourth quarter of 2020 according to the World Bank. Bitcoin is powering the future of money and this partnership highlights a strong use case of what the future will look like.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
