Will Banks Allow Blockchain to Create “The Great Sidestep” with P2P Transactions?

Peer-to-peer technology continues to make its mark on the world. These initiatives have substantial momentum, resulting in top-tier service providers embracing the model. Unfortunately, there are still some compatibility issues, including political opposition, to overcome.

Peer-to-Peer Technology Is Taking Hold

One must commend significant technology and service providers for their willingness to give up a degree of control by embracing peer-to-peer solutions. For instance, a network likePayPal orStripe doesn’t have to let users interface with one another directly, even if everything happens through their ecosystem. However, they opt for these solutions because it enhances the overall usability of their services and helps attract more users.

A similar pattern applies toCash App andVenmo. While these solutions are very different, the option to pay anyone through their nickname or split payments with others without relying on cash remains appealing. It transforms the way people think about payments and financial transactions and helps introduce more convenience for millions.

As successful as these platforms have become, one pressing issue remains apparent. Solutions like Cash App and Venmo are not available in most parts of the world. One can access PayPal and Stripe in many jurisdictions, but those firms have put tremendous work into regulatory compliance and obtaining the necessary licenses. This unnecessary regulatory red tape, combined with other political borders, can make it very difficult for peer-to-peer solutions to gain critical market traction.

Removing these boundaries through traditional technology will pose a set of challenges. However, the use of decentralized peer-to-peer technology creates new opportunities. For example, a concept such ascrypto banking was laughed at years ago yet continues to gain ground in 2022 and beyond. People have a demand for broader peer-to-peer connectivity, and they will pursue that option by any means necessary.

Crypto-based P2P Is The Next Frontier

To illustrate the concept of crypto banking and peer-to-peer technology, look no further thanPIP. The PIP team uses existing social platforms connecting billions worldwide and makes them compatible with scalable crypto protocols. For instance, Twitter and Facebook users can access crypto banking solutions on Solana, enabling seamless transactions without high fees or permission.

The team could have opted for building completely new infrastructure, although it would be difficult to gain traction. Building for Web3 is best done through existing technology stacks and platforms. PIP is a bridge between blockchain and Web 2.0 platforms like social networks. Unlocking the peer-to-peer economy remains the key objective. That will be achieved through three key solutions:

• Transacting currencies, assets, or anything else of digital value through existing social platforms
• Linking one’s social identity to crypto ownership
• Empowering all individuals to monetize their online creations, regardless of type or social platform

By embracing the peer-to-peer economy, people will be free to break out of their local economy and its overarching constraints. No one should earn less than anyone else due to artificial blockades making it so. Global micro-payments will pave the way for improving living standards for millions of people. More importantly, it will bring the global economic standard within reach and boost overall financial inclusion.

How Will Banks Respond?

The big question in this equation is how banks will respond to this ever-changing situation. As peer-to-peer technology becomes more popular, they will try to get in on the action. Unfortunately, banks and other financial institutions often have lengthy and complex signup processes, preventing certain groups of people from accessing their products and services. Blockchain-based P2P solutions bypass those requirements and offer a more streamlined experience.

It is in the banks’ best interest to co-exist with these emerging solutions. Consumers and businesses deserve convenient access to solutions that will enable them to thrive. Banks can tap into a broader audience by embracing peer-to-peer solutions, even if that means relinquishing some control and profit. Only time will tell if they are willing to co-exist or continue to try and shut out these emerging solutions as long as possible.