Elrond Network acquires Twispay and the approval to issue electronic money
Elrond Network, a scalability-focused layer 1 blockchain, has acquired Romanian payments provider Twispay and the authorization of the country’s central bank, the National Bank of Romania, to issue electronic money. The Romanian National Bank has authorized Elrond Network’s purchase of Capital Financial Services S.A., which operates under the Twispay name. Twispay is a financial organization that is authorized to offer payment services and to issue electronic money under Romanian law and with the approval of the National Bank of Romania. Twispay is also a founding member of both Visa (for issuing Visa cards) and MasterCard (for providing MasterCard cards for issuing and acquiring MasterCard cards).
Electronic money, often known as e-money, is a digital equivalent to cash that may automate financial operations in sectors like payments and e-commerce. Elrond aims to expand the usefulness of this well-established and regulated value transfer framework and bring it to its logical conclusion by combining it with a fast, scalable, and low-cost blockchain technology.
Elrond took a critical first step to position itself as a bridge between conventional banking and the crypto realm when it announced its desire to buy Twispay. This company may operate under passporting restrictions throughout EEA (European Union, Iceland, Liechtenstein, and Norway).
Beniamin Mincu, Co-Founder at Elrond Network, said:
This landmark decision from the Romanian Central Bank opens the door for EU citizens, and soon for everyone everywhere, to significantly benefit from value flowing with near-instant settlement times, at 100x fewer costs, with full transparency, and higher reliability.
Since the announcement in October 2021, the two parties have been in talks with the National Bank of Romania, with Deloitte providing financial and tax advice and Reff & Associates | Deloitte Legal providing legal help. The National Bank of Romania has formally voted in favour of Elrond purchasing Twispay after multiple rounds of amicable conversations and a decision regarding blockchain technology’s crucial role in developing finance.
The move comes as the EU Parliament considers limiting energy-intensive Proof of Work blockchain networks due to their negative effect on the environment. Elrond’s “carbon-negative” status is maintained by offsetting more CO2 than its already energy-efficient infrastructure is responsible for.
In addition to issuing electronic money, e-money institutions are also permitted to offer payment services within the European framework, as defined by the second Payment Services Directive (PSD2). Furthermore, according to the EU Commission’s proposed European Regulation on Markets in Crypto-assets, regulated e-money institutions would be allowed to issue stablecoins that may be sold to the general public in the Union or traded on a crypto-assets trading platform. Because virtual currency (including stablecoins), as the application of blockchain technologies, are intrinsically tied to the advancement of blockchain technology throughout Europe, the proposed regulation of crypto-assets and related activities is deeply connected with more comprehensive Commission policies on blockchain technology.
What is Elrond? The Software is Eating the World
Elrond is a piece of software designed to encourage a distributed network of computers to operate a smart contract platform focusing on scalability and cheap transaction costs. It creates a network strong enough to function at an “internet-scale” by putting a new twist on existing technology.
You’ve undoubtedly heard of the scaling paradox if you’ve been in the cryptosphere for a while.
The scalability issue: utilizing today’s technology, notably Proof of Work (PoW), the consensus method used by Bitcoin, the three critical qualities of a mature blockchain network (scalability, security, and decentralization) are hard to accomplish concurrently.
Elrond’s method to consensus is called SPoS. It eliminates PoW computational waste by combining eligibility through stake and rating – the foundation for Proof of Stake – with random validator selection and an optimal dimension for the consensus group.
The time in the block is split into 24-hour epochs and 5-second rounds. Elrond’s network’s validators are distributed over several shards, with each validator just needing to synchronize the state and perform transactions for their shard. To discourage validator collusion, up to 13 validators in a shard will be reassigned to different shards after each epoch. This has no impact on liveness since the quick state synchronization of the freshly reshuffled validators only synchronizes the state for the current epoch (24-hour period). In comparison, the shard’s remaining 23% of unshuffled validators may still execute transactions.
Elrond’s cryptocurrency, EGLD, is essential to the network’s upkeep and may be used to transmit, reward network contributors, and conduct smart contracts. Elrond was created in 2017 by Lucian Todea, Beniamin, and Lucian Mincu and is maintained by Elrond Network. A Malta-based corporation committed to the project’s growth.
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Disclaimer: The purpose of this article is to remove informational asymmetry existing today in our digital markets by performing due diligence, asking the right questions, and equipping readers with better opinions to make informed decisions. The writer holds Bitcoin, Ethereum, Cardano, Solana and Cosmos. The writer has been commissioned to write this story and thus has a vested interest in the companies/products mentioned above.