Revolutionizing Cross-Border Payments

Revolutionizing Cross-Border Payments

Christian Duffus

Christian Duffus

May 01, 2023

Cross-border payments play a crucial role in the global economy, with the retail and B2B cross-border remittance markets estimated to be worth over $2 trillion annually combined. However, the traditional centralized foreign exchange (FX) model is inefficient and costly due to the involvement of multiple intermediaries in the payment process. Decentralizing forex has the potential to address these issues and significantly reduce costs.

This whitepaper explores the potential benefits of on-chain foreign exchange (FX) for cross-border payments. The traditional centralized FX model has significant drawbacks, including high fees, slow transaction times, and a lack of transparency. On-chain FX has the potential to address these issues by eliminating intermediaries, providing faster transaction times, and increasing transparency.

The paper provides specific examples of on-chain FX implementations, such as Uniswap, Binance, and Curve, and introduces Fonbnk, a new company offering on-chain FX solutions. These examples demonstrate how on-chain FX works in practice and highlight the potential benefits of the technology for cross-border payments. However, potential drawbacks such as cryptocurrency volatility and security breaches should also be considered.

We invite you to view the full article, with included images, below and fully explore the two case studies. The rest of the article will follow in plain text with some images included.

Case Study 1:

Muhammad, a graduate school applicant hailing from Kaduna State in Nigeria, encountered a significant hurdle when attempting to pay application fees for programs in the United States, Italy, and China. Although his Nigerian bank card was part of the Mastercard network, the institutions refused to accept his payment. Nigeria's stringent currency controls severely restrict citizens' access to foreign exchange through traditional banking products, leaving Muhammad with limited options.

In search of a solution, Muhammad discovered Fonbnk, a platform that allowed him to convert his local prepaid airtime into USDC, a stablecoin pegged to the US dollar. This innovative approach enabled him to purchase branded gift cards in dollars and euros, which he then used to cover the necessary payments. As such, Fonbnk became a game-changer for Muhammad, circumventing traditional banking limitations and empowering him to achieve his educational goals.


The traditional centralized FX model has many shortcomings, making it inefficient and costly for cross-border payments. According to recent reports, decentralizing Forex can address these issues and reduce costs by up to 80%. This paper examines the potential benefits of on-chain FX for cross-border payments.

Benefits of On-Chain FX:

  1. Lower costs: On-chain FX can significantly reduce the cost of cross-border payments by eliminating intermediaries, such as banks and payment processors, and associated fees. Traditional FX models involve multiple intermediaries in the payment process, increasing user costs. In contrast,on-chain FX enables direct peer-to-peer transactions, bypassing intermediaries and reducing fees. According to a report by Boston Consulting Group, on-chain FX has the potential to reduce the cost of cross-border payments by up to 80%. For instance, Fonbnk's on-chain FX solution allows users to swap prepaid airtime for USDC, a stablecoin pegged to the US dollar, without intermediaries. This makes it a cost-effective solution for cross-border payments.
  2. Faster transaction times: On-chain FX transactions are processed on a decentralized platform, allowing faster and more efficient processing. In traditional FX models, transactions can take several days to process due to the involvement of multiple intermediaries. However, on-chain FX enables direct peer-to-peer transactions processed in real-time or near-real-time, depending on the blockchain's speed. For instance, Uniswap, one of the largest decentralized exchanges, allows users to trade various cryptocurrencies without intermediaries. Transactions on the Uniswap protocol are processed on the Ethereum blockchain, as well as other leading layer 1 (L1) and layer 2 (L2) blockchains such as Polygon, Arbitrum, and Optimism. These blockchains have different block times, with Ethereum's current average block time being around 13 seconds. This means that transactions can be processed near-real-time, making it a faster and more efficient solution for cross-border payments.
  3. Increased transparency: On-chain FX transactions are recorded on a public ledger, providing greater transparency than traditional centralized FX models. In traditional FX models, users have limited visibility into the payment process, making tracking their transactions and associated fees difficult. In contrast, on-chain FX transactions are recorded on a public ledger, which anyone can access. This provides greater transparency and accountability in the payment process. For instance, Binance, a centralized cryptocurrency exchange that has expanded into decentralized finance, allows for the peer-to-peer trading of cryptocurrencies. Binance's blockchain-based settlement system records all transactions on a public ledger, giving users greater transparency and visibility into their transactions. This can help increase trust in the payment process and reduce the risk of fraud or errors.

Examples of On-Chain FX Implementations:

  1. Uniswap: One of the largest decentralized exchanges,allowing users to trade various cryptocurrencies without needing a centralized intermediary.
  2. Binance: A centralized cryptocurrency exchange that has expanded into decentralized finance and allows for P2P trading of cryptocurrencies.
  3. Curve: A decentralized exchange focused on stablecoins, allowing users to trade stablecoins without needing a centralized intermediary.

Fonbnk as an On-Chain FX Provider:

Fonbnk is a groundbreaking web3 onramp solution and decentralized exchange project tailored for mobile-first, cash-based economies. By offering a unique hybrid model, combining both on and off-chain functionalities, it bridges the gap between traditional finance and cryptocurrency in regions with underdeveloped banking infrastructure. Utilizing mobile money and prepaid airtime as mediums of exchange, Fonbnk caters to exchanges, wallets, and other cryptocurrency businesses, providing seamless integration, local payment methods, and easy access to web3 and digital assets. This innovative approach connects billions of users to the digital asset ecosystem.

Central to Fonbnk's business model is its network of liquidity providers, which include airtime vendors, local businesses, crypto funds, and money service operators with idle capital in their crypto wallets, e-wallets, or bank accounts. These providers facilitate cross-currency and cryptocurrency transactions, earning fees in excess of 1% per transaction. With a focus on local payment methods without chargebacks, Fonbnk ensures a smooth, secure user experience and fosters digital asset adoption. The platform's internationally compliant fiat-gateway software solution attracts a wide range of business partners, further expanding Fonbnk's reach and impact in the cryptocurrency market.

Case Study 2:

Amina, a media specialist in Kampala, Uganda, was racing against the clock to meet a deadline for her advertising firm. She had to produce a large number of advertising creatives in a short amount of time for her client. Desperate to save time, she learned about a promising tool called ChatGPT.

However, when Amina tried to pay for the service with her Mastercard payment card, she encountered multiple transaction failures. Frustrated and out of options, she searched for a solution to her problem and stumbled upon a Twitter thread where fellow Ugandans were discussing similar issues. Some had experienced declined cards or country restrictions, while others were frustrated with the lack of transparency on pricing. Fonbnk saved the day for Amina when she needed it the most. By leveraging prepaid airtime and Fonbnk, she was able to overcome traditional banking limitations and achieve her aspirations.


On-chain FX has the potential to significantly improve the efficiency and accessibility of cross-border payments compared to traditional centralized FX models. Examples such as Uniswap, Binance, Curve, and Fonbnk highlight how companies and projects are leading the way in implementing this technology. By providing more cost-effective and efficient solutions, projects like Fonbnk can disrupt the trillion-dollar cross-border payments industry. However, potential drawbacks such as cryptocurrency volatility and security breaches should also be considered. As the technology continues to mature and adoption grows,on-chain FX solutions could become an increasingly viable option for individuals and businesses seeking to make cross-border payments with lower fees, faster transaction times, and increased transparency.


Austin Adams et al. - (

Uniswap -

Binance -

Curve -

Fonbnk - -