A patent application filed by American Express indicates that the global payment firm is considering the use of blockchain technology in boosting transaction speeds. In the patent application the travel arm of the credit card firm, American Express Travel Related Services Company, a technology capable of facilitating payments between parties by use of transaction requests acting as proxies is described.
According to the filing payment requests would be transmitted to the system which is based on blockchain and they would either get rejected or approved depending on factors such as risk analysis. In case the payment request receives approval, the transaction would be automatically processed with the accounts held by the receiver and sender getting adjusted.
Accessing the system will require the various parties involved in a transaction to create blockchain-based digital wallets. This will enable the payments to be made via the blockchain instead of third parties such as banks.
P2P payments made using the blockchain technology are referenced in the patent application though the wild volatility that is synonymous with Bitcoin (BTC) is cited. Due to the fact that it is a public ledger American Express argued in the patent filing that it would not be appropriate for its requirements.
“?cryptocurrencies such as Bitcoin rely on completely public blockchains. Furthermore, the value of crypto currencies, like Bitcoin, fluctuates widely making holding such currencies akin to speculation and less viable in emerging markets,” the patent application by American Express reads.
Second patent application
This the second time that the merchant and travel division of American Express is filing a blockchain technology patent. Towards the end of last year the same unit filed a patent application for a blockchain solution aimed at offering rewards that are specific to customers and this includes virtual currencies or points. These rewards would be given to customers based on personalized data compiled on a customer and this includes their spending patterns over time.
Besides the blockchain-related patent applications American Express also joined the blockchain consortium led by the Linux Foundation, Hyperledger, last year in January. At the time of joining the consortium the financial services company said it would use blockchain to rework its offerings.
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