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Former Intel and JPMorgan Workers Launch a Stablecoin

stablecoins

The cryptocurrency market continues to attract new entrants regularly. This time, however, we are greeted with news of the development of a new stablecoin. Earlier this week, the Global Currency Organization (GCO) announced in a news release that it would be launching the USD Digital (USDD), a stablecoin which will begin trading soon. 

The GCO, which is a project led by former workers at banking giant JPMorgan, stablecoin data aggregator TrustToken, and computer processor manufacturer Intel, claimed in the release that it will be making the stablecoin model available to a network of partners across the world, with a primary focus on the possibility of users to seamlessly make the switch from crypto to fiat currencies whenever they want.

Cryptocurrency inclusion is the goal here

The team, which is based out of San Francisco, claimed that the entire reason why the GCO was launched was based on a need to bridge the gap between decentralized and traditional finance. Joe Vellanikaran, the organization’s chief executive (And the former General Manager for the TrueUSD asset from TrueToken), added that the stablecoin would provide an institutional-grade digital currency to everyday traders. 

“We set out to make the benefits of blockchain available to all, a vision that is bigger than any one company. We are thrilled to be releasing USDD and opening up the GCO network to institutional partners worldwide,” he added. 

Vellanikaran added that the popularity of stablecoins has made it more apparent to people that collateralization in the blockchain space is just as important. 

“With USDD, we are taking the stability and security of a fully-backed stablecoin and opening it up to a global network of partners. This is the next evolution of the stablecoin industry.”  

The claims made by the developers pass the token to be more of a development and cryptocurrency adoption tool than just an asset which is supposed to generate value and be used for trading purposes. This is rather true, because if anyone is hoping to make any money from releasing a cryptocurrency, stablecoins aren’t particularly the best way to go.

Regulators wary of stablecoins

However, stablecoins themselves have come under some criticism lately. Early last month, Benoit Coeure, a member of the European Central Bank, argued at a meeting of the Bank of International Settlements (BIS) in Basel that stablecoins could potentially pose a risk to public policy priorities.

The event hosted heads of 26 Central Banks, as well as the team behind Facebook’s Libra stablecoin, to discuss the potential implications of the asset concerning national financial stability. 

According to a report from Reuters, Coeure reportedly stated, “Stablecoins are largely untested, especially on the scale required to run a global payment system. […] They give rise to a number of serious risks related to public policy priorities. The bar for regulatory approval will be high.” 

Libra has brought quite a lot of scrutiny on stablecoins since its whitepaper was released, with many seeing their characteristic of pegging values to fiat currency as being particularly dangerous for long-term financial stability. 

Given how many stablecoins already use the dollar as their peg, it might be difficult for the USDD to find a unique offering.

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