Thailand’s Krungsi Bank has introduced real-time blockchain intermediary transfers between Thailand and Laos. Krungsri Bank is part of MUFG, one of Japan’s largest banks. Krungsi is Thailand’s fifth-largest bank in terms of assets, loans, and deposits.
In 2017, Thailand and Laos jointly agreed to increase the value of their bilateral trade and investment by 2021 to $ 10 billion. By 2017, trade between the two countries was $ 6.17 billion, the Chinese news agency Xinhua reported.
Overall blockchain cross-border payments are gaining momentum in the Asian region. For example, the Monetary Authority of Singapore (MAS) has announced a multi-currency payment attempt developed by JP Morgan and Temasek.
Thailand itself has also approved a first regulated exchange for Initial Token Offerings (ICO). Despite relatively strict regulations, the Asian country obviously wants to become a pioneer in blockchain applications.
At the center of the Interledger project is the Interledger Protocol (ILP), which aims to facilitate communication between various international payment systems worldwide. The idea is that every payee should be able to pay each payee quickly and cost-effectively, or even for free, without both parties having to set up accounts with the same global payment service. ILP is a technology from Californian fintech firm Ripple, which offers blockchain-based, international payment technology to financial institutions.
One of the developers of the protocol establishes an ambitious analogy between ILP and the Internet communication protocols that allow the world wide web to send information freely and immediately around the world.
Sending money today within a single payment system is relatively easy, fast and inexpensive. However, transferring money between systems is cumbersome, slow and costly, if at all possible.
Special international payments still take days and sometimes cause high costs when running through multiple systems and intermediaries such as banks. Even with blockchains, the problem persists, as long as the communication between the systems is not regulated by an open standard protocol.
But to really become standard, ILP would also have to be used for applications that are not directly related to Ripple, the original developer. As a step in that direction, Ripple has launched ILP Open Source. The new Interledger project is now managed by the Linux Foundation.