CryptoCurrencyWire Editorial Coverage: The market for digital currencies is volatile by nature, and while some commentators declare an imminent bursting of the cryptocurrency bubble, many analysts forecast another bull run in 2018. Despite wild swings in digital currency, the underlying blockchain technology demonstrates more stability. With this in mind, investors are increasingly turning their interest to blockchain-focused enterprises, such Global Payout, Inc. (GOHE) (GOHE Profile), a company applying blockchain to logistics in the fintech sector. Processor developer Advanced Micro Devices, Inc. (AMD) has seen its earnings soar as it provides technology to support the blockchain, while NVIDIA Corp. (NVDA) received a boost from the sale of graphics processing units (GPUs) for cryptocurrencies and gamers. A shift of focus from digital commerce to using and investing in cryptocurrencies has seen Overstock.com, Inc. (OSTK) quadruple in value. Even tech giant International Business Machine Corp. (IBM) is exploring blockchain as a tool for payment systems and supply chains.
More than just Bitcoin
The usefulness of blockchain goes far beyond cryptocurrencies. It can provide user and product verification, smart contracts that automatically pay out on completion, and decentralized record keeping for more efficient supply chain management. It has the potential to radically improve logistics and financial technology, especially for organizations in the fast-growing cannabis sector that often cannot access traditional payment services.
It also decentralizes control of information and financial transactions, removing the need for a central user vulnerable to error and fraud. This can simplify and remove many of the risks from transferring data and money. The World Economic Forum has predicted that, by 2025, 10 percent of GDP will be stored using this technology.
With these advantages, the importance of blockchain extend beyond the companies directly invested in it. Advanced processing facilities are needed to power the technology, which is leading to dramatic growth for companies specializing in processing technology.
Global Payout, Inc. (OTC: GOHE) is one of the companies that has made blockchain part of a broader fintech platform. Founded in 2009, the company quickly established itself as a leading provider of payment solutions, allowing organizations to distribute money to employees and members worldwide. Global Payout’s implementation of the Consolidated Payment Gateway (CPG) provided comprehensive, customized solutions for business customers’ needs. Offering direct bank account, mobile account, and prepaid card account options for mobile user interfaces as well as prepaid cards, it served as a hub to international bank networks.
This initial product allowed Global Payout to develop the experience needed for a broader, bolder approach to the fintech sector. Focusing on logistics, it built up both its software and its business, investing in new subsidiaries and financial support solutions. It provides an increasing range of logistical solutions for the financial sector while it remains grounded in blockchain and other disruptive technologies. This allows it to benefit from revolutionary technologies without being vulnerable to dramatic downturns, such as the recent swing against cryptocurrencies.
Recognizing that the financial technology industry is a constantly evolving market, Global Payout quickly pivoted from its initial product. CEO James Hancock said, “As the role and relevance of today’s banks is shrinking, Global Payout is simultaneously helping the financial market to create better, faster, cheaper services for individuals, enterprises and governments.”
Launched in 2017, the Global Reserve Platform (“GRP”) is the next generation of financial logistics from Global Payout. A customizable web-based financial platform, it lets users manage any financial product, new or old. This “banking-in-a-box” approach makes it easy for users to fulfill the front-to-back office processing requirements of foreign exchange and international payment service providers. At its heart is the Global Reserve Administrative module, which financial institutions can customize to create their own financial management solutions.
GRP allows customers to securely and smoothly carry out a wide range of financial transactions. More traditional features such as prepaid credit and debit cards sit alongside mobile wallets as payment systems become increasingly integrated with users’ mobile technology. Biometric payments and authentication systems allow extra security. Loans, grants, market orders, and international financial transactions can all be managed through the platform.
Faster Supply Chain Finance
Global Payout has expanded its reach through subsidiary companies. One of these is SecurCapital, a fintech supply chain finance company.
Like GRP, SecurCapital’s SecurCloud platform is there to serve the needs of businesses by supporting the smooth flow of finance. It specializes in supporting the mid-tier logistics industry — forwarders, government contractors, motor carriers and suppliers. Its integrated system provides online access to cash, including global payments and foreign exchange. This lets mid-tier companies maintain momentum through swift service and transactions. Faster than traditional payment collection processes, its disruptive technology optimizes cash flow through delivery of invoices, proof of delivery and payment transactions to global vendors.
It’s the sort of swift logistics made possible by blockchain. Leveraging cloud-based innovations to provide smoother service, SecurCloud will cut out many of the intermediaries and delays that come from the previous generation of banking solutions. It is being launched by SecurCapital through blockchain conferences in the United States, China, and the United Kingdom (http://nnw.fm/xU0Ld).
Support for High-Risk Innovators
SecurCapital demonstrates how fintech innovation can create efficiencies for underserved companies in traditional sectors. But Global Payout is also extending its reach to new markets by providing fintech support to emerging high-risk markets. This is the work of another subsidiary, MoneyTrac Technology.
MoneyTrac serves the needs of a fast-growing market – cannabis suppliers and ancillary services. The erratic nature of the legalization process means that many legal companies struggle to access the financial services they need to carry out their businesses. With the spreading legalization of medical marijuana and recreational legalization in California and Canada, this is a sector set to grow at an exponential rate.
Traditional banks often won’t provide the services that cannabis vendors need due to fears over the potential impact of federal laws. As a result, disruptive financial solutions such as those offered by MoneyTrac fill a vital space in the financial ecosystem. By providing payment technology outside of the traditional banking system, they allow fast, secure transactions for those otherwise relegated to the risks and logistical inefficiencies of the cash economy. MoneyTrac’s customizable payment platform allows high-risk businesses to access systems in full compliance with the appropriate regulations, better carrying out and tracking their businesses. The company also offers business, branding and marketing consultancy so that customers can buy a full package of support.
A Bigger Blockchain Picture
The wider impact of blockchain is making itself felt across the fintech sector.
Advanced Micro Devices (AMD), which provides processing hardware used by blockchain companies, has seen a rise in earnings off the back of the past year’s cryptocurrency boom. In 2017, the company sold an estimated $320 million in chips to blockchain companies. It’s a relatively small part of the $5 billion in revenue the company produced last year, but a sign of how widely the benefits of blockchain have spread. The company now provides technology optimized specifically for blockchain as suppliers adjust to the new market.
AMD’s biggest rival, NVIDIA (NVDA), is in a similar position. Its GPUs sell to a range of markets, including gamers, data centers and blockchain companies. Blockchain is built upon large amounts of processing, and as the technology takes off, so will sales for the companies providing hardware and software. This led to a rise in earnings for NVIDIA in 2017, which appears set to continue in 2018.
Overstock.com (OSTK) owns 10 subsidiary blockchain companies, giving it a position of influence in the sector. Though primarily known for its operation as an online retailer, the company facilitates transactions in cryptocurrencies and runs a blockchain-powered currency exchange. This exchange is designed to comply with SEC and FINRA regulations, overcoming one of the main hurdles to blockchain – a perceived lack of regulatory compliance.
IBM (IBM), one of the most powerful and prestigious companies in the technology sector, also has its sights set on blockchain. Its focus is on exploring blockchain as a way of improving payment systems and supply chains. By reducing cash cycle time, increasing transaction visibility and cutting intermediaries, it’s aiming to provide faster financial transactions and greater transparency. The company is investing in blockchain technology that will replace sole-source in-house record-keeping methods, improving oversight and efficiency for logistical and financial systems. If a company on IBM’s scale is investing in blockchain, then we can be confident that it’s more than just a bubble.
Disruption is coming to the old financial systems. The needs of new markets such as the cannabis sector, and the drive for greater efficiency in businesses such as mid-tier supply chain, create opportunities for innovative companies. Those who embrace technologies such as blockchain as part of a balanced platform of services are likely to thrive in a period of disruption.
For more information on Global Payout, visit: Global Payout, Inc. (GOHE)
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