How to overcome Volatility and Liquidity problems in Cryptocurrency
The success of an economy greatly depends on stability and liquidity of the currencies they deal with. Small transactions with fiat currencies can bring stability to the economy but it brings up the necessity for liquidity. It works in the same way in cryptocurrencies also. Boon Tech has developed Boon Dollars (BD) to bring stability and liquidity to the world of cryptocurrency.
Obtaining Stability with Boon Coin
Boon Tech has a patent pending technology to obtain stability in their platform.
Boon Tech developed Boon Dollars use similar mechanism as that used in convertible notes. Convertible notes can be described as short-term debt instruments, the price of which will be determined in the future for converting into ownership.
There is difference between blockchain based token and convertible note. A blockchain based token represent the ownership in the community and convertible note is a debt denominated in terms of other commodity or currency. The holders of the convertible token has the advantage to convert token at the fair market price with a minimum notice. Reliable price, rules to prevent abuse, and liquidity are the major requirements for creating Boon Dollars. When there is token-convertible-dollars the blockchains can grow their network. It also results in maximizing the return for token holders.
Gaining Liquidity with Boon Coin
Boon Dollars allows to easily convert them at market price into dollars immediately , but that does not mean it will be a reliable dollar replacement. The liquidity of assets can be enhanced when the conversion between Boon Coin and Boon Dollars which happens instantaneously.
Blockchain has to find measures to prevent abuse, which will end up lowering the of the convertible dollars. Rewards are given to liquidity providers to compensate for this loss of quality.
Steps Boon Tech Developed to Stop Liquidity Issues
Boon Tech developed a patent pending mechanism to reduce liquidity by hedging the cryptocurrency against the most stable currency in the world which is US Dollars.
Boon Tech is a blockchain job platform where anyone can hire a vendor or freelancer to do any type of jobs. When a user use the platform to hire a vendor from the platform, he will first deposit the amount vendor charges for the job. Boon platform immediately convert this money into USD equivalent using couple of API calls and a patent technology to achieve this. Two external API are Coinbase API and GDAX API.
When the cryptocurrency is converted in Boon Dollars, which is pegged to USD. When the vendor completes the job, Boon Dollars will be converted into either USD or any cryptocurrency the vendor choose from.
Liquidity providers play the major role in leaving the market extremely liquid for remaining market participants to trade in. Liquidity providers buy and sells Boon Coin. Liquidity provider is the user who use the platform for hiring or providing service for employers. Users can earn rewards from both the activities. User needs to consistently perform from both sides as a freelancer and an employer to earn rewards.
Website: https://boon.vc/
