NYK Lines to Use Cryptocurrency for Crew Pay

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  • Nippon Yusen K.K. to design digital currency pegged to the U.S. dollar, to standardize payment methods.
  • Yusen controls over 80 vessels with 20-23 crew members each.
  • This will reduce the risk of carrying $40,000-60,000 in cash in order to pay the crew.
  • It might be a blockchain or cryptocurrency based digital platform, accessible through smartphones.

Experts at Nippon Yusen K.K., Japan’s largest shipping line by sales, say that the company will be introducing its own digital currency for crew members, read an article in Bloomberg.

What are the specific goals?

The goal is to make it easier for seafaring workers to manage, send and convert money into their local currencies, said an expert, who asked not to be identified because the plan isn’t public yet. The shipper is developing its own digital cash, pegged to the U.S. dollar to avoid wild swings in value. It wasn’t clear whether it would use blockchain, or be a cryptocurrency variant.

Why is there a need for going digital?

Most sea crews are usually paid in cash or have their pay transferred into a bank account. Because they hail from multiple nations and often have to move money from one country to another, digital cash offers the possibility of making it easier for them to track and spend their incomes. Yusen’s initiative, which will use smartphones, is on track to debut in the first half of 2019, the article reported.

What steps are being taken for developing the currency?

Yusen is working with banks and software developers to make sure that its digital money can be converted into local currencies, was the expert insight into the matter. Tests using shipboard tele-communications, such as satellites, have been successful, and the shipper is seeking a patent for its technology, says another undisclosed source. The Tokyo-based company is also interested in turning it into a service that it can offer to other shippers.

How will this affect the shipper?

Yusen owns or controls about 800 ships, each with about 20 to 23 crew. Each vessel usually has about $40,000 to $60,000 aboard to cover salaries and cash-based expenses. A majority of the seafaring workers for Japanese shippers is Filipino or Chinese, according to data from Japan’s transport ministry. Such a service is bound to reduce the risks faced by ships carrying money during long journeys across open seas.

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Source: Bloomberg

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