Newdex will launch PAXE, what is the vision for stablecoin?
In the last installment of our weekly blog series, we shared with you our thought on KYC. Today, we would love to discuss with you our perspective towards stablecoins.
On September 2018，New York trust company Gemini and blockchain startup Paxos were also approved by the New York Financial Services Authority to issue US dollar-denominated digital cryptocurrencies GUSD and PAX under government supervision. They are all based on Ethereum and are linked to the US dollar in a 1:1 ratio.
Unlike the stable currency that anchored the US dollar before, this is the first officially announced stable currency. The previous stable currency did not have a government endorsement.
Stablecoins are price-stable cryptocurrencies that pegged to a stable asset, like the US dollar. A useful stablecoins should be a medium of exchange, a unit of account, and a store of value.
Businesses and consumers don’t want to be exposed to unnecessary currency risk when transacting in cryptocurrencies. Thus, cryptocurrency volatility precludes blockchain-based loans, derivatives, prediction markets, and other longer-term smart contracts that require price stability.
And of course, there’s the long tail of users who don’t want to speculate. They just want a store of value on a censorship-resistant ledger, escaping the local banking system, currency controls, or a collapsing economy. For this reason, building a “stablecoin” has long been considered the Holy Grail of the cryptocurrency ecosystem.
Right now, the types of stablecoins on the market are yet not ideal. We will continue keeping an eye on the progress of the stablecoins market and listing various choices for our users. We firmly believe that stablecoins and Defi will go mass adoption.
In the future we will share more up-to-date project progress with you. Welcome to follow us on