N3XT Unveils Tokenized Cross-Border Payments

Blockchain-powered bank N3XT has received approval from Wyoming regulators to enable customers to utilize its digital token for cross-border transactions, according to Bloomberg. This approval allows N3XT to provide instant overseas transfers to both its customers and non-customers, positioning the bank as a direct competitor to messaging network Swift.

N3XT employs technology commonly used in the crypto and digital asset industry to offer this tokenized cross-border payment option. Unlike traditional banks, N3XT keeps deposits in cash or short-term securities, ensuring liquidity for transactions. N3XT's founder, Scott Shay, anticipates that this offering will attract clients from the shipping and logistics sectors, as well as the crypto industry.

The bank intends to reveal the new service on August 18 at the Wyoming Blockchain Summit in Jackson, Wyoming. In December, N3XT launched as a fully blockchain-powered bank, enabling clients to make instant, programmable B2B payments in U.S. dollars around the clock. PYMNTS reported in June 2024 that companies are increasingly investigating blockchain solutions for streamlining cross-border payments, enhancing cash flow, and improving liquidity management.

Blockchain technology promises to revolutionize the industry by providing a more efficient, cost-effective, and transparent alternative to conventional payment methods, which have been hampered by high costs, slow settlement times, and a lack of transparency. Swift recently announced that its blockchain-based ledger is ready for use, with 17 banks set to conduct live pilot transactions.

The Bank for International Settlements reported in May that they and their partners created a prototype demonstrating the potential of combining tokenized commercial bank deposits with the "trust and safety" of tokenized central bank reserves on a shared platform.