Author Topic: Foreign exchange & modeling a business after Transferwise  (Read 892 times)

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Offline merivercap

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Hey all,
I just came across a company called Transferwise.  Have you guys used it or something similar before?
https://transferwise.com/
Article:
http://tech.eu/features/764/transferwise-taavet-hinrikus-interview/

It's reached over 1 billion pounds in total volume in about 4yrs.  They claim to have saved 45 million pounds for users.  I think their model is to essentially match inflows/outflows of currency exchange between their customers rather than via banks and to use the mid-market rate of an established price feed.

It's based on a p2p model.  If Bob wanted Euros and has a bank account in Europe, he'd find Alice in Europe who has a US bank account that wants US dollars.  Bob would send US dollars to Alice's bank account and in exchange Alice would send Euros to Bob's bank account in Europe at an agreed mid-market rate between bid/ask.  No international bank wire fees, FX fees, fewer delays etc.

If Bob wanted to pay Euros to Matt in Europe, Bob can request Alice in the above example to send it to Matt's European bank directly.   

I was discussing starting up a remittance platform with a couple others on this forum, and  it seems this business model is a complement to the overall remittance business.  You can create a system in a very similar way between fiat currency & Bitcoin/BTS/BitAssets + multisig to avoid having to send international bank transfers. You will still have the risks of local bank restrictions.   Hence cash + BitAssets + a p2p Abra style model is probably the best.  In that article above they mentioned CurrencyFair (FX marketplace - $1.7B+ euro in total transfers), TransferGo & Azimo (similar to Transferwise?), Kantox (FX for small/medium biz + mid-cap - $1B euro+ in transfers) ... these are all interesting non-Bitcoin FX fintech companies.  I think BitAssets can be used to complement or compete with many of these new FX markets and businesses.

What do you guys think and anyone familiar with these businesses?
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