Find the best broker for your trading or investing needs The Big Blue is helping launch a stablecoin (or coins that are pegged to fiat currencies) cryptocurrency. IBM Corp. (IBM) has partnered with Stellar, a blockchain that shares technology with Ripple, and Stronghold, a startup, to launch USD Anchor. Coins of USD Anchor are backed by an equivalent amount of US dollars stored at FDIC-insured banks by Nevada-based Prime Trust.
According to Jesse Lund, IBM’s head of blockchain services, the startup plans to “enable all sorts of digital transactional networks to settle their transactions with digital fiat currency on the same blockchain networks.” In simple words, this means IBM wants to create a network where digital fiat currencies can be used to settle transactions across multiple blockchains. “What we envision is a network that has multiple different asset classes living on it.
You could have digital euros, digital dollars, digital pounds – and they are all really kind of running on the same networks,” said Lund, adding that this could expand the use cases of digital currencies beyond just trading in cryptocurrency markets. As cryptocurrency markets have grown, the role of stablecoins has increasingly become controversial. The role of Tether, the stablecoin issued by cryptocurrency exchange Bitfinex, has come under a cloud after allegations surfaced charging the exchange with artificially propping up bitcoin’s price.
Bitfinex’s refusal to submit the coin to an audit has further complicated matters. (See also: Tether and Bitfinex Subpoenaed By US Regulators).
But there are a couple of differences between Tether and USD Anchor. Prime Trust, the asset protection company that is backing USD Anchor tokens with fiat currency, claims that it has been audited. Read more from investopedia.com…
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