Let’s talk about stablecoins?
Stablecoins are especially popular on the cryptocurrency market, since they are backed by traditional assets (fiat money, bullion, or something else). With that said, as in the case of regular cryptocurrencies, these coins are located on the blockchain. So, does this mean they are collateralized, decentralized and transparent? Let’s find out how stablecoins are backed these days.
The most widespread option today is stablecoins that are backed by fiat money. This is the simplest recipe for making a stablecoin. Such coins are price-pegged to the fiat currency they represent, and are in some way debt obligations. Each cryptocoin becomes equal to the traditional currency (for example, the dollar.) How does it work? Some of the biggest USD stablecoins manage their reserves completely privately, other leading stablecoins choose to publicise their cash reserves to trusted verifiers who can check anytime and reassure users that the reserves are sufficient to cover the stablecoins in the market at any given moment. Either way, for these digital coins, the peg is always maintained with the help of the fiat dollar.
Apart from traditional coins, you can also find decentralised stablecoins (algorithmic or synthetic coins). The price on these coins can also be pegged to the US dollar, but they are backed by a basket of other cryptocurrencies that are added to smart contract vaults each time new coins are minted. This mechanism is automatic thanks to smart contracts. Algorithms maintain the price of decentralised stablecoins, in a decentralized fashion, with zero human input. Some stablecoins can bring profits for using their holders’ deposits in a DeFi investment portfolio as the reserve. In that case token holders can always check the safety of their reserves through the blockchain. However, what if we bring that decentralised reserve management over to the stablecoins that use real-world reserves? That is exactly what the EURxb stablecoin does.
EURxb token is a stablecoin that is pegged to the euro, completely transparent, and capable of yielding 7% APY profits by simply holding it in your wallet. We have already talked that EURxb is collateralized by tokenised ISIN registered securities (minted in accordance with the EURxb protocol). With that said, when compared with USDC, all the issued coins are backed at a ratio of 4:3, not 1:1. The reserves have also been proven — they are legally bound and pledged through the creation of bonds in the security market, ensuring the protocol’s legitimate and actionable rights to these real-world assets, just like in any other regulated financial system. This guarantees that the token won’t lose its value, and its holders can utilize it like any other currency to yield them profits!
EURxb is a next-generation stablecoin, 100% in line with decentralization principles. Every transaction is trackable, and the currency is ready to be used to bring you profits!
