IBM is launching a new cross-border payments system based on the Stellar blockchain to help reduce the cost and time required for clearing transactions across borders and currencies. IBM Blockchain World Wire will compete directly with the incumbent SWIFT protocol and Ripple for use as the payment rails of choice when transacting across borders. IBM \u2665 Blockchain The IBM Blockchain World Wire cross-border payments solution will run off of the Stellar blockchain and is the fruition of a partnership between the two announced just under a year ago in October 2017. The aim of the project is to eliminate much of the time and additional cost required for banks to perform cross-border payments by offering a 'near real-time' solution using digital assets. Here is how it works: Two financial institutions transacting together agree to use a stable coin, central bank digital currency or other digital asset as the bridge asset between any two fiat currencies. The digital asset facilitates the trade and supplies important settlement instructions. World Wire then simultaneously converts the digital asset into the second fiat currency, completing the transaction. All transaction details are recorded onto an immutable blockchain for clearing. IBM is expected to demo the solution next month at the upcoming Sibos conference taking place in Sydney in late October. Organized by SWIFT, Sibos is an annual event that brings together global financial services players focusing on\u00a0payments, securities, cash management, and trade. IBM has been steadily increasing its focus on blockchain technology as it continues to evolve beyond its old-school mainframe roots. In addition to a variety of\u00a0 projects such as moving municipal services onto a blockchain, 'big blue' has been trying to establish intellectual property in the blockchain space. The company reportedly has filed the second most blockchain-related patents globally according to iPR Daily, a Chinese media outlet that consolidated data from patent applications from China, US, Europe, Japan, South Korea, and the\u00a0World Intellectual Property Organisation. But the IBM Blockchain World Wire project is by far the company's biggest bet on blockchain yet and for good reason as they hope to disrupt what is expected to be a $2 trillion industry by 2020. Blockchain Disrupting Cross-Border Payments Although it may appear seamless to the average person who withdraws money from an ATM while on holiday in a foreign country, the actual settlement of that transaction can take days or even weeks to complete between the banks. The typical means of settling these transactions between the banks involves multiple intermediaries (middlemen) who provide provide liquidity in the respective currencies but also add fees that are typically passed on to the end user. Given the breadth and scope of the global digital economy, this antiquated system for cross-border payments is ripe for disruption through technology. This is exactly what IBM Blockchain World Wire is attempting to do\u00a0\u2014 though they aren't the only ones attempting to do so, nor are they the first at the table. Ripple, the company behind they cryptocurrency XRP, has been working at changing how institutions can transact across borders for several years now. In fact, the partner IBM chose for their cross-border payments solution, Stellar, was co-founded by Ripple's founder, Jed McCaleb. Although Stellar and Ripple both have a similar goal of facilitating cross-border payments (early versions of Stellar were based on the Ripple protocol developed by McCaleb), they have vastly different approaches on how to do so. A good summary of the technical differences between Ripple and Stellar can be found here. Ripple is a for-profit company that has targeted multinational organizations and banks as customers of their different payment rails for cross-border transactions. Whereas the nonprofit Stellar.org has a mandate to promote global financial access, literacy, and inclusion. Whether Ripple's corporate first approach or Stellar's more altruistic messaging and partnership with IBM are able to disrupt cross-border payments remains to be seen. But the next time you get hit with a foreign transaction fee at a bank or when shopping online it will become apparent the problem that both are trying to solve.