- US Banks shutdown due to stimulus payment demand
- Blockchain offers far greater scalability and can cope with demand
This week over 80 million Americans will begin to receive stimulus checks. However, many US banks have been struggling to cope with demand.
As waves of checks were deposited into bank accounts, banks saw a surge in demand. As a result, many banks faced temporary outages and issues. US Bank, PNC, and Fifth Third Banks are among those who shutdown, while Bank of America and TD Bank saw service interruptions.
As a result, many Americans were unable to collect their checks and had to wait until systems were back online. In addition, many Americans will not receive their checks in the first place due to outstanding debt, reported earlier this week. Although the idea of stimulus check carries merit, execution is equally as important.
How Blockchain Can Help
However as US banks shutdown due to stimulus payment demand, blockchain offers a solution.
Ripple is an existing blockchain-based financial platform. The project offers financial services to over 350 institutions in over 40 countries. Among those services, the platform provides instant, secure, and cost-efficient bank transfers. As a result, Americans can get access to funds quicker than traditional methods.
Furthermore, Ripple offers immense availability and transaction processing power. Ripple can handle 1,500 transactions per second, scaling up to 50,000 per second if needed. This will help alleviate stress on centralized banks and help funds reach Americans quicker.
Central Bank Digital Currency (CBDC)
If nations do not want to use preexisting solutions, they can develop a CBDC. Central bank digital currencies (CBDC) are digital currencies that are pegged to the national currency and thus, CBDC’s are essentially cryptocurrencies without the volatility. More importantly, CBDC’s use blockchain technology. One of the many benefits of blockchain technology is its scalability. Blockchain’s offer greater scalability than traditional methods. Furthermore, blockchains are 100% transparent ensuring that stimulus funds are not abused
Amid COVID-19, China has already begun testing its CBDC. As reported earlier this week, the currency can be made available to the public as early as next month.
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