American giant IBM, in cooperation with the Stronghold start-up, began working on a new cryptocurrency, tied to the U.S. dollar. The stablecoin named Stronghold USD, will be launched on blockchain Stellar, Fortune reports.
WHY IS IT IMPORTANT?
1. The technology-driven giant is a pioneer in the field of business solutions based on blockchain technology. For example, the company has developed a program with which it is possible to track the chain of international transfers in real time, and also to conduct such transactions several times faster.
2. Recently, stablecoins became one of the leading trends in the cryptocurrency market. So Tether, the most widely used analog of the USD, can now bypass the popularity of bitcoin. Many other companies also develop their own versions of the coin for $1, including Circle, TrustToken, and Basis.
“There’s this tremendous opportunity to make blockchain payments feasible, especially for cross-border. What is great about this is they are just basically digital dollars—digital fiat currency,” says Bridget van Kralingen, IBM’s senior vice president of global industries, platforms, and blockchain.
It is assumed that Stronghold will place its dollar reserves in the Prime Trust fund, which will handle bank accounts in institutions insured by the Federal Deposit Insurance Corporation (FDIC). IBM will be responsible for applying use cases for a new coin among institutional investors, including cross-border transfers and multi-currency operations. According to Jesse Luna, the head of the IBM unit, the company will start using the new technology by the end of this year.