In recent years, the cryptocurrency industry has seen tremendous growth and innovation. This has been accompanied by an increasing focus on utilizing different rails to enable cryptocurrency transactions. One such development involves Nilos, a payment infrastructure provider, who has partnered with card issuer Modulr in order to allow businesses to make crypto-to-fiat payments quickly and easily across Europe using special virtual accounts.

The Single Euro Payments Area (SEPA) and Faster Payment rails form the backdrop to Nilos' settlement which allows payments between EU, and certain non-EU member countries, to happen within the 10 second timeframe that complies with SEPA requirements.

Holders of digital wallets from the electronic monetary institution Nebeus can now use Nilos to send fiat that has been converted from cryptocurrency to special IBAN accounts across Europe, with just 7 seconds required for a payment to be originated and settled. The Zumo wallet service provider, based in Edinburgh, U.K., is also able to fund its crypto wallets via direct settlement from users' bank accounts.

The collapse of Silvergate Bank and Signature Bank, causing crypto firms in the U.S. to look for alternative rails to facilitate the exchange between crypto and fiat, led to other banks introducing payment networks to cater for cryptocurrency customers. Silvergate offered its clients the Silvergate Exchange Network; Circle now use Cross River Financial's 24/7 crypto-to-fiat Real-Time Payments System and Coinbase, the largest crypto exchange in the U.S, have also adopted this infrastructure.

The restrictions of the COVID-19 pandemic have also arguably catalyzed developments in instant payments; the Bank of England recently tested a new real-time system across two separate ledgers, and the U.S. Federal Reserve (Fed) is set to trial instant interbank transfers via its FedLine network from July 2020. Such developments could potentially provide a framework for the creation and implementation of a central bank digital currency, although this would likely serve to undermine the value proposition of fast P2P crypto payment networks like Lightning.

The Lightning Network is able to facilitate cheap, fast and efficient payments between nodes across a channel, with transactions waiting times far faster than those on the Bitcoin network. The network is also able to facilitate micropayments which would otherwise be unviable due to the high fees attached to 'on-chain' transactions, and can provide transactions with throughputs of up to one million per second - a rate unparalleled by Visa and Mastercard. However, the security of Bitcoin in a Lightning wallet must first be ensured before payments can be locked into a channel, so users may be better off opening a bank account with a FedNow institution.



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