It was another strong week for stablecoins, as total market cap passed $23 billion. Whether it’s battling an illegitimate government in Venezuala, or addressing draconian capital constraints in Vietnam, stablecoins are truly making the world a better place.
As they continue their march to $1 trillion market cap, here are the five stablecoin events from this week that highlight ecosystem progress:
1. Circle Is Working With The U.S. Government to Deliver Aid via USDC to Venezuelans Healthcare Workers
On Nov. 20, Circle announced their first government partnership to leverage USDC. In partnership with the U.S. government, and the deposed Bolivarian Republic of Venezuela, USDC is being used to put millions of dollars into the hands of front-line medical workers in Venezuela as they battle coronavirus, while suffering from the impacts of hyperinflation and economic collapse caused by the disastrous policies of the current illegitimate government.
By working with Circle/USDC and Airtm (a bank-and-blockchain-connected, dollar-denominated payment platform that powers digital dollar payments throughout South America), the exiled government was able to bypass the controls on the Venezuelan financial system and put dollars seized from the current government into the hands of Venezuelan healthcare workers with a virtual private network connection.
Stablecoins are truly making the world a better place.
2. Vietnamese Crypto Exchange VNDC Launches The First Stablecoin Backed By VND, The Vietnamese National Currency
VNDC, a Vietnamese cryptocurrency exchange with over 700,000 customers, partnered with U.S. stablecoin-as-a-service provider, Stably, to create VNDC 2.0, a stablecoin pegged to VND (the Vietnamese dollar).
Vietnam is a socialist republic with only one political party, the Communist Party of Vietnam (CPV). So it’s not surprising that Vietnam has lots of capital controls. VNDC 2.0 addresses those controls by taking in the money in Vietnam and holding the reserves in Hong Kong. So VNDC 2.0 So for the first time, Vietnamese customers can have offshore money without breaking the law (i.e. exchanging VND for a foreign currency). The VNDC stablecoin launched on November 20, 2020
3. Settle Network Launches Stablecoins In Argentina (ARST) & Brazil (BRLT) Using Stellar Infrastructure
To facilitate moving value from the traditional banking system into Stellar and vice-versa, Stellar relies on “anchors,” which are regulated financial institutions, money service businesses, or FinTech companies that issue fiat tokens and/or provide fiat on/off-ramps to the anchor country’s banking system.
As an anchor in the Stellar network, the Settle Network leverages Stellar technology to create stablecoins backed by the domestic fiat currencies in Argentina and Brazil.
Settle handles KYC/AML, and allows stablecoin holders to make deposits and withdrawals in Argentine pesos (ARS) and Brazilian reals (BRL) in a matter of seconds, opening a new world of possibilities for international remittances and cross-border payments.
4. Bridge Mutual Announces Decentralized Insurance on Stablecoins
On Nov. 17, Wyoming-based Decentralized insurance provider Bridge Mutual announced its new insurance service, started world first-ever insurance coverage offering for stablecoins.
Bridge Mutual is a decentralized, discretionary insurance application that allows users to insure each other and get reimbursed in the event of a market crash or an attack, which leverages a decentralized app on both the Ethereum and Polkadot network.
Bridge’s insurance solution to stablecoins is impactful because it’s truly decentralized and doesn’t depend on people to handle the claims. Bridge tracks the price of all the stablecoins on its market across multiple exchanges. If the average price of a stablecoin drops beneath a predefined price point for a set period of time, any claimant that was covered before the price drop can submit a claim using Bridge App and instantly receive the full value of the policy they purchased. There is no voting or chance for human manipulation that might result in a valid claimant being denied.
Users that want to provide insurance simply purchase BMI tokens and stake them in Bridge coverage pools. Those funds are then algorithmically invested in on-chain platforms like Compound and Aave to generate yields for the insurance providers.
Stablecoin holders that want insurance can get a quotes generated on-chain by an actuarial formula. To purchase the insurance, users then connect their wallet (e.g. Metamask and others) and pay for the coverage.
Part of the premiums paid by users buying coverage is split among users providing that coverage as a profit-sharing incentive.
5. Kory Hoang, CEO of Stably Presents “The Stablecoin Evolutionary Stack,” A Framework For Putting Stablecoins In To Context
The awesome featured guest on “Stablecoins Are Killing It” Episode #21 was Kory Hoang, CEO of Stably, which provides tokenization and stablecoin-as-a-service solutions to B2B/enterprise clients.
During the show, Kory used the graphic above to outline a detailed framework for thinking about stablecoins and how they’re evolving from fully backed and centralized (Generation 1 stablecoins) to decentralized, smart, and algorithmic (Generation 5).
You can watch a replay of the show on YouTube, or read “ 8 Highlights From “Stablecoins Are Killing It #21.
You can click here to register on Zoom for “Stablecoins Are Killing It” #22, On Thursday, Dec. 3, from 1–2pm est, featuring Algorand’s David Markley.
