The FinTech and blockchain development company, Everex, based in Southeast Asia, recently concluded a test case with migrant workers in Thailand. Using the Everex wallet, workers were able to send Thai Bahts (Thailand’s national fiat currency) to relatives in Myanmar without the need for a bank account or money transfer service like Western Union.
The goal for Everex is to put fiat currency on the Ethereum blockchain. It's called CryptoCash because, as Alexi Lane, CEO of Everex said, "we want to distinguish [from] Bitcoin and Ether, which is mined and not connected to conventional finance. CryptoCash is another form of national fiat currencies which uses the blockchain as rails."
If one were to analogize CryptoCash, they could think of it as a blockchain based cashier's check. The goal would be for banks to issue their own CryptoCash, similar to issuing a cashier’s check. Everex plans to position itself as a technical guarantor of the system and to work with banks and other financial institutions; allowing more sources of revenue to serve untapped markets such as p2p finance.
The legality of CryptoCash is tricky and as Alexi pointed out, "True peer-to-peer transactions currently exist in only two forms: cash transactions that are done hand-to-hand and cryptocurrencies like Bitcoin. So now we are inventing a new way to transfer fiat currency peer-to-peer without banks or Western Union, and nobody quite knows how to regulate that."
The total transaction time for workers in Thailand to send CryptoCash to their relatives in Myanmar is approximately one minute. Traditional money senders like Western Union can take up to a week.
Once a relative in Myanmar receives their CryptoCash in Thai Baht, or perhaps more aptly, Crypto Baht, they can go to a local money exchange and redeem their Crypto Baht’s for Khats (Myanmar's national fiat currency). Those holding the CryptoCash do not need to worry about dealing with the volatility of cryptocurrencies like Bitcoin because the CryptoCash represents a digital form of their local fiat currency, the same way a cashier’s check represents real cash with a piece of paper.
According to Alexi, "Money exchangers are the backbone of this system because they serve as a gateway between fiat and crypto. The exchanger is also who defines the exchange rate, which will be determined by free market mechanics. The value proposition for a currency exchanger is that they can be involved in a money transfer service without a money transfer license, because all transactions are peer-to-peer. They still need a license to cash the check and to exchange the money, but what the user does with the CryptoCash is out of your jurisdiction."
Using the Everex wallet, Thai workers sent close to 800,000 Thai Bahts to and from Myanmar, and at a transaction fee of 0.5%, it’s a fraction of the cost of traditional money senders.
The test case in Thailand is officially on hold while Everex acquires a money exchange license and works with litigators in Southeast Asia to navigate the regulatory hurdles they’ll need to overcome if they wish to realize the vision behind CryptoCash. If successful in Southeast Asia, they plan to expand on a global scale.