Former Consensys Employee Launches Stablecoin 'USD3'

CryptoNews.com

2024-05-29 21:25:03

Tanzeel Akhtar

Last updated:

May 30, 2024 01:25 EDT | 2 min read

Former Consensys employee Jack Jia, the founder of Stable.com has launched USD3, a “payments-first” new stablecoin despite the present lack of a regulatory framework and uncertainty around the market.

The USD3 is a 1:1 backed stablecoin and aims to be an extension of the U…S dollar for global commerce and Web3. Jia announced the launch of the stablecoin at the ongoing Consensus 2024 event being held in Austin, Texas between May 28- 31.

Stablecoin USD3 is launched on Ethereum, Polygon, Avalanche, and Linea. Stablecoins are a type of digital asset designed to have a stable value by being pegged to a reserve asset, such as a fiat currency in this case the U.S. dollar or a commodity like gold or even other crypto.

Crypto traders often use stablecoins for trading, borrowing, and lending in the decentralized finance (DeFi) space, while others use them to access the stability of the dollar in countries where dollars are otherwise unobtainable.

The main purpose of stablecoins is to combine the benefits of digital currencies—such as fast transactions and security—with the stability of traditional currencies.

“We learned from the mistakes of previous players and know what they lack today – our vision for USD3 is future-proof,” said Jia, in a press release. “Plan is to reach mass adoption of our stablecoin and become a base for a new global payments ,” adds Jia.

Well-Known Stablecoins

The most well-known stablecoin is Tether (USDT). Tether is widely used in the crypto market and is pegged to the value of the US dollar, aiming to maintain a 1:1 value ratio with it. It is commonly used for trading, transfers, and as a store of value within the crypto eco. Other notable stablecoins include the USD Coin “USDC.”

There has been discussion over stablecoins Tether’s USDT and USD Coin USDC specifically exploring which one is safer.

Stablecoin Regulation

In the U.S. the newly introduced bill — the Lummis-Gillibrand Payment Stablecoin Act was introduced on April 17.

Regulatory clarity around the stablecoin market is supposed to encourage wider adoption. Most recently the U.S. credit ratings firm S&P Global said that a change in rules under the Lummis-Gillibrand Payment Stablecoin Act could see U.S. stablecoin adoption soar as the regulatory framework could bolster confidence.

In Europe, the Markets in Crypto Assets Regulation (MiCA) regulation around stablecoin reiterates that the issuers of the pegged currency must comply with regulations. But the lack of clarity has seen some exchanges de-list Tether’s USDT.

OKX discontinued support for Tether’s USDT stablecoin for users based in the European Union and the European Economic Area back in March.

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