IBM tests with "Stronghold USD", a new stable currency linked to the dollar that runs on the Stellar network
A new project for a stable currency linked to the US dollar, which runs in the Stellar blockchain, has received support from IBM, Reuters reported on July 17.
The new asset is called "Stronghold USD", as it is known to the fintech startup that created it, Stronghold. The token was released on Tuesday and is reportedly issued using a 1: 1 price ratio to the US dollar. As Fortune points out, it is the first stable value cryptographic project used by the Stellar network.
IBM has been victimization the Stellar network to facilitate cross-border payments since 2017, and it's aforementioned that it's currently begun testing this new stable currency. Jesse Lund, international vice chairman of IBM Blockchain, told Reuters:
"IBM will explore use cases with business networks that we have developed, as a user of the token. We see this as a way to bring the financial exchange to the transactional commercial network we have been building. "
In her interview with Fortune, mother superior van Kralingen, IBM's senior VP of world industries, platforms, and blockchain, same the new project depicted a "tremendous opportunity" to modify the company's existing cross-border blockchain payment efforts.
Van Kralingen same that, until now, IBM has been changing between totally different fiduciary currencies victimization the Stellar, Lumens (XLM) native image as a bridge between them. the prevailing system is doubly exposed each to the variable intrafat exchange rates and to the disreputable volatility of the cryptocurrency markets, to that Lumens, in contrast to a stable currency, remains subject.
A stable currency, used as a frictionless digital proxy for exchange by fiat, could eliminate both variables and potentially "play a very important role in improving costs," he said.
Van Kralingen added that stable currency projects linked to national fiduciary currencies other than the US dollar would be equally valuable for the integration of the IBM blockchain.
IBM has also partnered with Columbia University to open the Columbia-IBM Center for Blockchain and Transparency, which will offer students internships at IBM and joint research opportunities.
Stable currencies have been gaining momentum with figures from the crypto industry and Blockchain, as Jeremy Allaire, Circle's co-founder and CEO, imagines them to be an integral component of an emerging "global tokenized economy." This was exposed at the MoneyConf event held in Dublin last month.
This spring, Circle closed a $ a hundred and ten million fundraising spherical to partner with mining hardware manufacturer Bitmain within the development of its own stable currency backed by the United States dollar.
Tether (USDT) remains one of the most famous, albeit controversial, examples of a stable cryptocurrency linked to fiat money. Others in the industry are looking for different means to forge a currency that would be immune to market volatility.
Last month, the CoinTelegraph website reported on a project for a stable token called "Reserve" that maintains a link through the use of an intelligent contract to block other cryptographic assets, instead of fiat currency. The initiative has received the support of PayPal co-founder Peter Thiel and the main cryptocurrency exchange service in the United States, Coinbase.