Fiat-Backed Stablecoins ?- Attempt to Take the Best of Both Worlds

에 게시 됨 by Cointele | 에 게시 됨

Stablecoins attempt to be fiat currencies among cryptos.

The project was called Mastercoin, which was later renamed as Omni.Now, developers tie stablecoins not only to the U.S. dollar, but also to the euro and the Japanese yen.

TetherThe first stablecoin is currently the most popular and has the largest capitalization of all stablecoins.

The main difference between TrueUSD and other stablecoins is the coin's focus on significantly improving transparency and compliance with legal practice, as it was argued that Tether lacks in that department.

"The technical, financial, and legal burdens are all substantial - but the biggest challenge of all is earning and maintaining the trust of your users. Though we offer the transparency of regular 3rd party audits, the lowest transaction costs of any ERC20 stablecoin, and strong partnerships, users tend to pick the stablecoins they use based on word of mouth and user experience, which includes customer service."

"I always wanted to create some competitor to the US dollar and simplifying the reach for the underlying currency, the Euro, makes a lot of sense macro-wise. US regulators do not segregate digital assets from existing buckets they already regulate. But Europe's regulators treat the asset class more competitively and I foresee that they will adjust existing e-money regulation to include stablecoins. It was developed 20 years ago and is becoming obsolete because of blockchain technology. In my view, stablecoins should be seen as e-money 2.0.".

DAI's emission scheme looks like this: The user sends a certain amount of Ether to the smart contract that issues the DAI tokens in return, which means that the newly created DAI tokens actually represent a collateralized debt to MakerDAO.The main feature of MakerDAO is that the platform uses two tokens - the DAI stablecoin and the utility token Maker.

ConclusionVarious developers around the world are keeping a close eye on the development of stablecoins as the technology aims to alleviate the shortcomings other, more volatile cryptocurrencies are experiencing.

Stablecoins can become an intermediate in the process of replacing the physical money supply with a digital one.

"We consider stablecoins to be an integral part of building the financial infrastructure of the future. Our mission is growing economic opportunity for all, and making money easier to access, move, store, and use has always been the first step. It's not so much a cure for crypto's volatility, as it is a tool for financial inclusion."

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