KEY TAKEAWAYS
- StraitsX partners with Ant International and Grab to enhance tourism spending in Singapore using blockchain technology and Purpose Bound Money (PBM).
- The initiative leverages Avalanche’s network to enable a stablecoin-powered payment system, facilitating faster and more secure cross-border transactions.
- StraitsX’s integration with Avalanche’s infrastructure aims to provide efficient and compliant payment solutions across the Asia-Pacific region.
- The collaboration supports the growing demand for seamless e-wallet transactions in Southeast Asia’s expanding merchant networks.
StraitsX, a payments infrastructure provider for digital assets in Southeast Asia, has announced a new initiative in collaboration with Ant International and Grab. This partnership aims to transform tourism spending in Singapore by leveraging blockchain technology and Purpose Bound Money (PBM). The initiative seeks to facilitate faster and more secure payments for travelers using Alipay+ apps at GrabPay merchants.
The collaboration was first outlined in a Memorandum of Understanding (MOU) at the 2023 Singapore Fintech Festival. It has now led to the deployment of a live cross-border, stablecoin-powered payment system enabled by the Avalanche network. Alipay, which boasts approximately 1.3 billion users and 180 million merchants, is a key player in this initiative.
Enhancing Cross-Border Transactions with Blockchain
With the rise of e-wallets and expanding merchant networks in Southeast Asia, there is a growing demand for seamless cross-border transactions for tourists. Traditionally, users face challenges using their preferred e-wallets in foreign countries due to a lack of interoperability between wallet and merchant networks. By utilizing Avalanche’s blockchain technology, StraitsX aims to enable faster, more secure, and cost-effective cross-border transactions without relying on traditional intermediaries.
PBM is a protocol that specifies the conditions under which an underlying digital currency can be used. It acts as a bearer instrument, allowing secure transfers without third-party verification. In this initiative, PBM uses StraitsX’s XSGD as the underlying digital currency. The PBM layer contains smart programming rules that ensure XSGD can only be transferred to whitelisted wallets, providing secure payment processing for goods and services.
Leveraging Avalanche’s Infrastructure
StraitsX is utilizing AvaCloud and Avalanche’s Layer 1 (L1) infrastructure to expand its XSGD stablecoin offering and integrate its payments technology into the Avalanche ecosystem. Operating on an L1, StraitsX benefits from fast finality, deep liquidity, and high throughput, which are ideal for large-scale stablecoin transactions. This integration is expected to offer faster and more cost-effective transactions to users across the Asia-Pacific region while maintaining compliance standards required for financial applications.
The collaboration also sets the stage for future initiatives with financial institutions, which can easily create private L1s for seamless cross-chain communication and transactions. Several institutions, including StraitsX, have leveraged the Avalanche network for their digital asset strategies due to its EVM compatibility, sub-second transaction finality, low fees, and customizability.
As of September 2024, international users across 12 Alipay+ partners can transact at GrabPay merchants in Singapore. With Southeast Asia’s cross-border e-commerce revenue projected to reach $148 billion by 2027, small and medium enterprises (SMEs) will require more efficient payment methods. The launch of this cross-border stablecoin-powered payment system comes at a pivotal time, with Singapore tourism reaching 16.5 million visitors in 2024, positioning merchants to capitalize on the anticipated surge in inbound tourist spending.
For more information about StraitsX, visit here.
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