Stablecoins breakdown and why they are important (part 2)
GUSD is a stablecoin which is issued by Gemini Trust Company. Gemini Trust Company established by the Winklevoss brothers in 2014. The company is regulated under New York State Department of Financial Services. To ensure the safety of the US deposit, Gemini decided to keep their USD in State Street Bank and Trust Company. Each month, an attestation audited by BPM will be published on their websites. Moreover, GUSD smart contract is audited by Trail of Bits, Inc.
- Ticker: GUSD.
- Total market capitalisation (as of November, 7th, 2018): $9,541,746
- Website: https://gemini.com/dollar/
- Attestation: https://gemini.com/dollar/#reports
- Code audit: https://gemini.com/wp-content/themes/gemini/assets/img/dollar/gemini-dollar-trailofbits-audit.pdf
- Exchanges: Bibox, Okex, Hotbit, Latoken, HitBTC, The Rock Trading, CPDAX, BCEX, BitForex, ABCC, EXMO, Coinsuper, CoinBene, DigiFinex, DEX.top, Fcoin
GUSD as stablecoin
Having a good reputation on legal framework and the code, we think Gemini USD should be worth to use as stablecoin.
USDC is issued by Circle Internet Financial Inc. The company is registered with FINCEN as Money Services Business and it is backed by IDG Capital, Breyer Capital, General Catalyst Partner. Strategic investors: Baidu, Goldman Sachs, CICC Alpha, CreditEase, Everbright Bank, WanXiang. To maintain the transparency of the fund, Centre works with several banking partners including Silvergate Bank, US Bancorp Asset Management (USBAM). Silvergate will serve as settlement banks, where all transaction-related activity will be managed while USBAM will hold USDC reserve balances. Centre’s USD deposit balance audit report is performed by Grant Thornton LLP monthly. CENTRE, an open source project and membership organization established by Circle, will keep a records of blacklist address to prevent illegal payments.
Note: As of November 6th, 2018, some of the info above have been removed from the website.
- Jeremy Allaire: Graduated from Macalester College with several degrees including: political economy, philosophy, political science, etc. Jeremy is a talented individuals and have known Sean for quite a long time. They both worked in Allaire Corporation before it was sold to Macromedia. The duo later moved to Brightcove and worked there for several years before establishing Circle.
- Sean Neville: About Sean, he used to work in different companies such as Macromedia, Brightcove and Sevenchord. In 2013, he and Jeremy co-founded Circle.
- Centre’s board of directors: Jim Breyer, Quan Zhou, David Orfao.
- Centre’s independent directors: Raj Date, M. Michele Burns, Alex Nostrom.
Linking a bank account
Currently, Circle supports bank in the following countries: Andorra, Australia, Austria, Belgium, Bulgaria, Canada, Estonia, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, Lithuania, Luxembourg, Mexico, Monaco, Netherlands, Norway, Poland, Portugal, Romania, San Marino, Singapore, Slovakia, Slovenia, South Africa, South Korea, Republic of, Spain, Sweden, Switzerland, Thailand, Turkey, United Kingdom, United States, Vatican City State, Vietnam.
Circle USDC Fee Schedule
- Ticker: USDC.
- Total market capitalisation (as of November, 7th, 2018): $134,209,769
- Website: https://www.centre.io/usdc
- Whitepaper: https://www.centre.io/pdfs/centre-whitepaper.pdf
- Attestation: This info has been deleted from the website as of November 7th, 2018.
- Exchanges: Poloniex, Coinbase Pro, CPDAX, Latoken, Okex, CoinEX, KuCoin, CoinSuper, Fcoin, Crex24.
USDC as stablecoin
Like other stablecoin, USDC provides the transparency to the investors. Therefore, we think should also consider using USDC to protect your portfolio.
The downside of stablecoins
Because most of these companies are regulated by the US governments. Therefore, they are required to have the power to control, freeze, investigate your account, data if it violates the law. Take a look at these screenshots:
To be fair, we think that it’s necessary for those companies to have some control over their product so they can remove illegal parties from the system.
Stablecoins have the potential to transform the cryptocurrency scene and move the blockchain technology into the mainstream. To us, stablecoins are a safe haven of sorts for investors to minimise their loss during bear and volatile market. With a proper strategy and a cool head, we think it’s possible to utilise stablecoin as a tool to help you during your crypto journey. Essentially using a sable coin is 1x leverage. What you are doing is pretty much shorting. Selling high to buy back in lower and getting a bigger bag. Therefore you don’t lose any value in your investment in terms of USD but you can use that same amount of USD you have to accumulate your favorite altcoins at a much cheaper price thus allowing you to accumulate a much bigger bag. “Getting the most bang for your buck” is pretty much utilizing a stable coin correctly. However, the downside of the stablecoin is the companies that operate them are allowed to keep, control your funds, monitor your transactions as well as freeze your account at will (as shown above). Also note stable coins themselves are also volatile as just recently USDT crashed to $.85. Stable coins are not a means of getting a high roi on your investment. Their only purpose is to preserve your USDamount in times of a downtrend so you can readily accessible funds to buy back in cheaper instead of converting your BTC to USD then having to wait again for your bank to transfer money. Crypto market is such a wonderful place with surprise, isn’t it?
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