Stablecoin, a “firm price” cryptoactive

Being one of the main problems of Bitcoin its high volatility in the market, the intrinsic advantages that it possesses position it as “future economy” due to its global reach and decentralization.

Given this scenario, the idea of ​​developing crypto-active products that had a “stable price” was born. These were called “stablecoins“, and they were given the objective of merging the characteristics of fiat currencies and crypto-currencies, designed to maintain a constant price, linked to a stable fiduciary currency, or collateralized with products or other cryptocurrencies.

Stable asset types

At present there are several types of stablecoins that seek to achieve the union between cryptocurrencies and fiduciary money. The three categories of stable tokens would be:

• Guaranteed with fiat currencies or products.
• Backed by other cryptocurrencies.
• Without backup guarantee.

In the first group, cryptocurrencies are guaranteed by an equal amount of fiduciary currency held by a custodian. Such as:

1. Tether (USDT) is the best-known example of stablecoins. Originally launched as Realcoin, the project was founded in November 2014 and has two tokens: USDT and EURT, analogous to the dollar and the euro. The cryptocurrencies are connected to the Bitfinex exchange house.
2. TrueUSD (TUSD) is another token linked to the dollar that is part of the TrustToken platform. It arises in 2018 with the idea of ​​acting with more transparency than Tether. This digital asset was generated as an ERC20 token in the Ethereum blockchain. Currently, it has a token distribution of $ 16.6 million units, according to its intelligent contract.
3. Digix Gold (DGX), where the guarantee of support is gold. The project started in 2014 in Singapore, under the direction of the company Digix. They assure that each token is equal to 1 gram of gold approved by 99.99% gold smelting from the refineries of the London Bullion Market Association (LBMA).
4. USD Coin (USDC) was recently announced by the company Circle, FinTech subsidiary of Goldman Sachs. For the management of the cryptoactive has been created the CENTER organization, which will be responsible for issuing the cryptocurrency.

In the second group, the stable tokens are backed by the reserves of another cryptocurrency. The purpose is to solve the centralization of the stablecoins with fiat, although the backup is a volatile cryptocurrency. Here some:

1. Dai (DAI), developed by the company MakerDAO. The coins began to circulate in December 2017 and are backed by each user’s Ether (ETH) digital assets, held in intelligent contracts, seeking parity with $ 1.
2. BitUSD (BITUSD) was created by Dan Larimer in 2013 and is supported by the BitShares cryptocurrency platform, which also serves as a guarantee for BitCNY and BitGold and other tokens, all called BitAssets.

In the third group are the non-collateralised stablecoins, which don’t have a guarantee backed by assets. Price stability is achieved through an approach called Seigniorage shares, conceived by Robert Sams, founder and CEO of Clearmatics Technologies LTD. As:

1. Basis, formerly Basecoin, is a recently launched token that sets its price at $ 1, although the idea is that it can be linked to a basket of assets, such as the consumer price index (CPI), as the holders use the currency to buy goods and services.
2. NuBits (USNBT) was created in 2014. It uses a “decentralized liquidity fund” based on the chain of blocks, which offers users the possibility to control their resources and trade tokens in exchange.

In general, the creators of all types of stable tokens affirm that regardless of the stable token classification, “this type of currencies will resolve the volatility obstacles of the cryptocurrencies, predicting that they will be more used to fix prices of goods, do every type of purchases, sign contracts, send money orders abroad and serve as a reliable reserve of wealth “.

N. Moncada

Source: CriptoNoticias

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