New Token Borrows a Page From Facebook's Project Libra
A new cryptocurrency project launched as a "stablecoin," which means that tokens are pegged to fiat money values, is making news headlines thanks to its prominent executive board and business model. Saga is a blockchain development firm based in London; the company's advisory board members include a prominent JPMorgan executive, a Nobel Laureate economist, and the founder of the Chicago Mercantile Exchange. The specific project is SAGA, a token that intends to promote immediate circulation by virtue of basing its value on a basket of major currencies, including the United States dollar, the euro, the yen, the yuan, and the pound sterling.
If the concept of SAGA, which will trade under the SGA symbol, sounds familiar, it is because Facebook is working on a digital currency project that also intends to draw value from the average exchange value of major currencies. While Facebook has faced strong criticism from financial regulators ever since Project Libra was announced, SAGA has covered its fiscal bases by means of compliance with the International Monetary Fund. The goal of SAGA is to serve as a global token that complies with generally accepted currency rules; to this effect, it has partnered with major banks connected to the IMF for the purpose of building up reserves.
What's Different About SAGA?
Unlike privacy-minded cryptocurrency tokens such as Bitcoin, Monero, and Dash, SAGA will comply with anti-money laundering and "know your customer" provisions typically used in the banking system. For the most part, SAGA's supporting blockchain is decentralized to the extent that currency holders have voting rights with regard to governance, but this could change in the future. The U.S. will not be part of the initial SAGA project because the business development team does not have a full picture of regulatory compliance in this specific country.
One important aspect of SAGA is that developers do not wish to profit from the operation; this sets it apart from Project Libra because Facebook intends to be the issuer, custodian, and payments processor. In other words, Facebook wishes to profit from the Libra token, which is something that developers of the centralized digital currency known as Ripple have already accomplished.
SGA tokens will be available in early 2020 from the Saga.org website and from the Liquid cryptocurrency exchange. As of mid-December, the value of SGA/USD was around $1.38, with a 24-hour high of $1.66. The SAGA development team intends to curtail volatility with special smart contracts that would control the supply of tokens according to demand patterns.