Stable coin has become one of the important application areas of blockchain.
The first application of blockchain technology is about cryptocurrency, and the background of stable currency is that cryptocurrency price fluctuations are huge, and a cryptocurrency with stable value is needed as an bridge to connect cryptocurrency and fiat currency. In 2014, the stable coin originator USDT was launched by Tether, the parent company formed cryptocurrency exchange Bitfinex, which opened the stable currency market ever since. In addition, the stable currency can effectively eliminate the risk of price volatility, as a payment tool, it can provide faster transfer efficiency and better user experience than the bank, and can eliminate credit card fees…
All kinds of positives have made the stable currency market very active. In just a few years, the development speed of stable coins has been springing up. This momentum has been particularly evident since last year. Led by PAX, USDC, and GUSD projects, 15 institutions announced the launch of stable coins in 30 days, causing the market to question “will this be a new round of bubble?”Since this year, the market has become more interested in “stable coins”. The representative technology giants and financial giants like Facebook, IBM, JP Morgan Chase and Goldman Sachs, all have quietly laid out in the field of stable coin. Meanwhile, there are hundreds of projects that attempt to launch “stable coins”….
The importance and prospects of stable coin are beyond doubt:
- It is an important link between digital currency and fiat currency ;
- The price is stable, needed as the utility token in various scenarios;
- Take the important role of risk avoidance
- Decentralized, safe
The challenges of releasing stable coin from Facebook
The prospect of stable coin can be seen from the secret training team of Internet giant Facebook, and their stance on developing stable coin as s secret weapon. stable coin will bring two major benefits to Facebook:
First of all, in recent years, Facebook’s revenue by advertising has declined. In contrast, WeChat and Alibaba, have already quickly formed their hands with payment tools such as WeChat payment and Alipay which the various life scenes are picked up into their own traffic boxes and developed into super applications. However,Facebook is only continuously acquiring social sub-products to expand the scale. Facebook is increasingly aware of that Internet companies that do not engage in finance are not really good companies, and the demand for Indian users on their acquired WhatsApp is more frequent. Mark Zuckerberg finally decided to spend billions of dollars on stable coins.
Of course, Internet companies do not have to go through the way blockchain + stable coin . In the past two years, Facebook was caught up by scandals of “abusing centralized internet power” especially after they sold user data to Cambridge Analytical, and was even pointed out to leave loopholes for Russians to post advertisement and have even affected US elections. So this time, to engage in finance, Facebook must first of all to tag themselves with the amulet of decentralization.
Finance + decentralization, payment + ecological scenarios? If the stable coin supported by the blockchain is not the perfect choice, there would be no one else? Of course, whether it is Facebook, JPMorgan Chase, or Tether, the release of stable coin has its own strong driving force. As listed above, stable coin have various functions and benefits in different industries and scenarios. Today ,there is no need to further reinforce that.
At present, more important than the prospect of stable coin, are the actual challenges faced in the real issuance of stable coin. Although we has not participated in the specific stable coin project, only from the perspective of the underlying technology, the major challenges can be listed:
- stable coins as a tool for carrying payment functions in multiple scenarios, and used by hundreds of millions of users, can the performance of blockchain support such large-scale, high-frequency transaction processing?
- About the stable coin , if it is limited to a specific scenario,it’s very hard to unleash its tremendous value. With the digitization process and the development of other stable currencies, a stable currency must involve multiple digital assets , How to solve a variety of stable coin interactions and cross-chain interaction problems?
- In the case of multi-party participation in the operation of the stable coin, how to ensure the equal status of the participating parties, achieving the decentralization ?
Choose the right platform, is the vital beginning for stable coin
None of the current platforms can really support this level of stable coin like the global coin of Facebook. From the perspective of performance and scalability, it will kill most of the platforms, not to mention cross-chain interconnection and decentralization.
That being said, we believe in the long history of stable coin ,even in the next few decades or even hundreds of years, Paralism will have its heavy stroke in the writing !
First, for performance , Paralism is upgraded to a parallel chain, unlike the single-chain structure of a traditional serial chain. It is the only parallel blockchain system in the industry that is infinitely scalable, the sub-chain itself can conduct dynamic sharding, and is compatible with multiple types of sub-chains. The advantage is obvious: it can carry massive services and scale to cope with high concurrent transaction data processing. The only digital platform can support for global stable coin ! For giant projects such as Facebook and JPMorgan Chase, Paralism can strongly support them!
Furthermore, Paralism’s stable coin goals are global and diversified. Thanks to the Paralism multi-sub-chain parallel environment, users who want to try to stable coin can choose the system existing or design a special consensus mechanism in the system, meet the customer’s needs, ensure self-independence. The process of the stable coin issuance can be wholly defined by one self , running with chain resources and technical support, ensured with safety and controllability!
In addition, the parallel blockchain structure provides a natural cross-chain interaction solution between the chains, so that all kinds of digital assets in the system can be interconnected at any time while maintaining parallel and consistent operation. Moreover, the assets can be pegged to multi-country legal currency or a digital currency of other sub-chains. Compared to stable coin that are confined to a single serial blockchain, the stable coin on Paralism are provided with a wide range of application scenarios and more flowing space.
The Paralism parallel system uses a completely decentralized global consensus, using the Buddy consensus algorithm of the node mutual authentication principle. With this algorithm, each node will participate in the global consensus generation in the peer position, completely avoiding the appearance of vicious privileged nodes, ensuring that the stable coin will not be on in small group of people, maintaining its decentralized , users can use the stable coin issued by Paralism as a trading medium without worrying about your assets being controlled by one or some nodes.
Based on Paralism’s infinite scalability, cross-chain interaction, and complete decentralization, Paralism will open a stable coin release template during the online operation of the platform, and launch a stable coin investment plan, allowing those with stable financial resources to join in Paralism. Stable coin encourage the role of the funder, the guarantor, and the fund manager to join the chain through stable coin channel and promote the development of the chain business. In a stable environment where multiple stable coins coexist, multiple market players participate, and different functional stable coins are fully competitive, a stable market is formed, which helps digital asset users to share“stable happiness”!
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