Transaction speed is the time it takes for the network to complete one operation. Why is it important for cryptocurrencies to have a high transaction speed? Well, the higher the exchange speed, the faster a transaction is finished; hence a user is more satisfied. Let’s see which of the existing digital coins are the fastest and if they are able to outperform traditional payment systems.
Changelly prepared a list of cryptocurrencies that have the highest transaction speed on the market. In this article, we will also compare blockchain-based networks to conventional money transfer systems and see which ones are more efficient in terms of transaction time.Traditional Payment Systems vs. Cryptocurrencies
There are several well-established fiat payment systems: Visa, MasterCard, PayPal, and some others. It feels like they have been around forever and it’s just how the money transfer industry works. For a while now, there’s been an alternative to traditional payment systems – blockchain-based cryptocurrencies: Bitcoin, Ether, Ripple, Litecoin, and more. Let’s make a small comparison that shows us the differences between bank wires and typical Bitcoin transactions.Purchasing with VISA card Purchasing with Bitcoin The payer uses a physical wallet The payer uses an electronic wallet The purchase can be refunded The transaction is irreversible Might have high fees The sum of fees depends on the network congestion Requires three or more parties Requires only two parties
Let’s stop on the last line. As you can see, there can be more than three parties only in one transaction. What are they? Here is a typical Visa transaction which includes four parties:Merchant Acquirer (the actual financial institution that enables payments for the merchant) Issuer (cardholder’s bank) Individual cardholder
Here is the thing. To make a payment, you need to wait for the approval of three parties. It can take quite a big amount of time.