Sofi Technologies to Utilize Bitcoin for International Money Transfers
Sofi Technologies, a digital bank, is about to make history by becoming the first U.S. bank to use the Bitcoin network and universal money address. This move will enable users from the U.S., Mexico, and beyond to send money via the Lightning network.
The bank has teamed up with LightSpark, a Bitcoin payments infrastructure provider, to roll out its blockchain-based international money transfer service. This announcement was made public on Tuesday.
“For many Sofi members who frequently send money to family overseas, the ability to do so quickly and affordably isn’t just a perk; it’s a significant enhancement to their everyday financial lives,” was emphasized during the announcement.
According to Sofi, users will have the option to send money internationally through the Sofi app, stepping into a competitive global remittance landscape, projected to reach $740.5 billion in 2024.
On social media, Lightspark highlighted the collaboration: “sofi + lightspark = instant global payments. 🌍⚡ Sending money abroad in seconds now with UMA.” They hinted at more countries joining this service soon.
Details on Sofi’s Bitcoin UMA Solution
Sofi’s new UMA-driven international money transfer service permits customers to convert U.S. dollars to Bitcoin in real-time and transfer funds across borders via the Bitcoin Lightning network.
The UMA by LightSpark allows users to send money using email-like addresses, leveraging the benefits of the Bitcoin Lightning system. LightSpark was founded in 2022 by David Marcus, who previously served as PayPal’s president.
Sofi claims that its costs are “below the current national average,” ensuring transparency by displaying exchange rates and fees to members before they proceed with any transactions. The service is accessible 24/7 for its 11.7 million members.
Coinbase’s Integration with Lightspark
A year ago, Coinbase integrated Lightspark’s Bitcoin infrastructure, which enabled instant and low-cost transactions. By April 2024, 15% of Bitcoin transactions at Coinbase were utilizing the Lightning Rails through Lightspark’s system.
Slow Adoption of Lightspark’s Solution in Brazil
In Brazil, Neobank Nubank joined forces with LightSpark in June 2024 to offer Bitcoin Lightning payments to 100 million customers throughout Latin America. However, it’s unclear if this Bitcoin payment option is fully operational yet.
