Blockchain Advisor speaks to Sirish Kumar, the Co-Founder and CEO of Telr, about the promises blockchain tech brings along, how Telr is using blockchain to offer innovative solutions on the market, and the future of crypto
Can you please share your views regarding the blockchain tech?
We’re very excited about the potential that blockchain brings. It’s an application for our times: it aims to bring together security, accessibility and the ability to treat real-world items as digital ones, making it the platform for interlinkages across our current and future digital ecosystems.
It comes with its challenges of course, as paradigm-shifting new technology tends to do – it requires prodigious quantities of power to function, transactions are not as rapid as they need to be, and the cost of conducting transactions using blockchain remains expensive. But we believe that the case for the distributed ledger is so compelling across so many growth areas of our digital lives that market forces will provide the correct incentives to find solutions to these issues. Its adaptability will grow when more businesses automate their processes, particularly those that focus on repetitive transactions.
Behind the noise – of which there is undoubtedly a lot – blockchain has the potential to stitch together our physical world and our digital world, artificial intelligence with real-life applications, automation with universality.
How is blockchain revolutionizing the global financial industry?
Today, more by promise than delivery. Right now, blockchain’s limitations constrain it too great to give it the ubiquity it needs to truly bring revolution to the way we all operate our finances. But the potential of blockchain, the promise of the changes it could bring, is what makes people speak of it in terms of a revolution.
Blockchain could be particularly helpful for transacting across borders, with a significant positive impact on the speed, cost, and security of international payments. A blockchain-based payment gateway would enable payments to be sent anywhere around the world in 15 to 20 seconds. This is significantly shorter than routing payments through traditional banking channels, which can take up to 3 days. And by using the blockchain ecosystem as a foundation, payments are highly secured and therefore less prone to attack than traditional online payment gateways.
This element of security is one of the fundamentals that will help drive mainstream acceptance of blockchain as a transaction channel: from a payment gateway’s point of view, merchants will likely come to appreciate the decentralised aspect of blockchain rather than necessarily view it as a barrier to adoption. This, in turn, will help drive consumer adoption: end-users of payment gateways will feel more comfortable and are more likely to use a payment platform when they know that their payments are safer from attacks. As consumer expectations change, the participants in the e-commerce ecosystem will need to adapt accordingly.
Another area that we’re very interested in unpacking the power of blockchain into is fraud detection. Due to the nature of the distributed ledger, transactions can be tracked across the blockchain network, and machine learning can be applied to identify and flag fraudulent behaviour – as opposed to the situation we currently have where data about an individual’s transactional behaviour is the sole property of the financial institution that he’s been transacting through. We see this as bringing great benefit to merchants – we’d be able to identify and prevent fraudulent transactions from taking place, and as importantly, make sure that genuine transactions succeed.
Apart from cryptocurrencies what is the value proposition of blockchain tech?
Blockchain technology brings security – the inherent design of blockchain makes it tamper-proof. It brings speed – transactions can cross borders in seconds, rather than the days it can take with current banking processes. And it brings freedom to data – there is no centralised ownership or storage of data.
How is Telr leveraging blockchain tech to offer advanced solutions and products?
Telr is a unique payment solution company enabling settlement of payments to online merchants across the Middle East, India, and South East Asia. We’re actively exploring blockchain solutions, which have many extremely interesting applications in the world of online payments – whether it be from the perspective of rapid cross-border payments, or enhanced due diligence with our merchants, speeding up their onboarding time, or improved fraud detection.
Blockchain will also bring its own changes to the online payments industry – for instance, where blockchain is used to power smart city transport networks, which will generate large volumes of automatically incurred micro-payments.
What does Telr want to achieve by using blockchain tech?
As a payment aggregator, we’re constantly striving to enhance the payments environment for our merchants – where security, speed, and convenience are critical factors. Blockchain offers the potential to take leaps forward in this respect, whether by opening up new payment channels and options or by speeding up existing processes.
Our mission is to join the dots across the e-commerce ecosystem, to make it easier for our merchants to succeed online. And this is where blockchain truly stands to make a difference. Because of the nature of the distributed ledger, we’re looking at a landscape where different applications are able to ‘talk’ to each other across the blockchain. But blockchain is also able to provide a digital ID for physical items – which now means that all of the intelligence and experiential advantages of online payments can now be applied into the bricks-and-mortar world, alongside smart stock management and logistics.
Do you believe cryptocurrencies will eventually replace fiat currency?
I don’t believe that cryptocurrencies will replace fiat currency, but there’s absolutely no reason why they can’t exist alongside each other. Regulators are increasingly accepting of transactions conducted in cryptocurrencies and so, in my view, it’s only a matter of time before cryptocurrencies become normalised as digital currencies.
The primary obstacle for this to be achieved, though, is the volatility of cryptocurrencies. The current tendency of cryptocurrencies to swing dramatically in value makes it challenging to align them to the value of the transaction in a fiat currency – as at some point there’s going to be a need to translate the crypto amount into that fiat currency. Once cryptocurrencies manage their volatility so that they’re able to function as a store of a value rather than primarily a speculative instrument, then they will have taken a significant step towards becoming viable currencies.
With blockchain, there’s a lot of hype – and the current noise around cryptocurrencies doesn’t help. But while there’s a lot of talks, there’s also a lot of execution taking place even now, and a great deal of governmental and supra-governmental interest and activity. Blockchain is here already, and it’s here to stay.