The new Lightning-based service gives foreign workers a new way to send their pay back home quickly and cheaply. That’s why Send Globally is one of CoinDesk’s Projects to Watch 2023.
The problem.
Dismissals of the real-world utility of cryptocurrency are often based on the assumption that money works the same way around the globe as it does in the United States.
Critics – including powerful U.S. legislators – often cite the convenience of services like PayPal or even credit cards as proof that cryptocurrency has no utility. But that ignores the very real differences between nations’ financial infrastructures – and how many places PayPal or other services simply don’t reach.
Those barriers are much more obvious to people who do a lot of small-dollar international transactions, such as immigrants sending money back home. Using traditional financial infrastructure for these so-called “remittances” often relies on complex and high-trust relationships among banks. That complexity has made it easier for conventional remittance services to charge sometimes extremely high fees.
For example, according to the World Bank, the cost of remittances to Nigeria has averaged close to 8% over the past decade. That adds up dramatically: In 2020 and 2021, nearly $3 billion was spent on remittance fees to Nigeria alone. Given Nigeria’s roughly $440 billion GDP, that’s enough missing money to amount to a drag on the national economy.
And while Nigeria is a major recipient of remittances, it’s just a tiny slice of the pie: Global remittances in 2022 added up to $626 billion. Cutting just 1% from the fees on those remittances would mean an additional $60 billion in the pockets of people who need it.
Read profiles of all of the Projects to Watch 2023: Reclaiming Purpose in Crypto
The idea: Send Globally.
As crypto winter set in over the course of 2022, the crypto industry talked a lot about the “pivot to BUIDLing” that often follows when the most degenerate forces in the industry get blown up and quiet down for a bit. Strike’s new Send Globally service, launched in December 2022, embodies some of the greatest promises of that bear-market urge.
Send Globally solves a real problem in the world using cryptocurrency. It leverages the Bitcoin blockchain and the Lightning Network to offer international cash transfers that are faster, more flexible and often less expensive than what’s offered by traditional financial services. It’s designed to be easy to use and understand for people who know nothing about crypto.
Most important for the direction of the crypto industry, Send Globally has an honest-to-god business model: a sustainable approach to generating revenue in exchange for real services, instead of through selling speculative tokens or lunatic financial engineering. Given the ongoing regulatory crackdown and post-bubble skepticism facing crypto, it’s more important than ever for projects to focus on real, paying end users.
“You send money that you see as dollars from the United States, and it’s received on the other side. They receive it in their local currency, either in a bank or in a mobile account,” explains Manuela Rios, Strike’s vice president of product. Rios, who joined Strike from Robinhood Markets in December 2021, knows the challenge of remittances intimately. Her grandmother lives in Colombia, and Rios describes having to jump through expensive or complex...
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