Coming off the back of an overall bearish year for Bitcoin, 2019 has seen a drastically turnaround, as most prominent cryptocurrencies, including Bitcoin have demonstrated impressive growth.
With the price of Bitcoin recently reachings its 15-month high, part of this growth may be attributed to the recent influx of large tech companies and financial institutions into the space — promoting the mainstream adoption of cryptocurrencies.
There is also an observable rising interest in the banking sector, with several banks recently warming to the idea of using or implementing blockchain enabled cryptocurrencies in their operations. Most recently, Switzerland based online banking and trading platform Dukascopy unveiled its entrance into the cryptocurrency sector.
A Token for Each Fiat Currency
According to the recently released Dukascopy whitepaper, the bank will be launching its own cryptocurrency known simply as Dukascash. At launch, Dukascash will be available as three separate tokens, each pegged to a different fiat currency like EUR, CHF, and USD. In time, Dukascopy hopes to increase the range of fiat currencies Dukascash represents.
The three Dukascash tokens along with any others potentially launched in the future will be managed on the Ethereum network as ERC20 tokens. These stablecoins are expected to be first sold in tranches to clients and should become tradeable on external exchanges at an undisclosed later date.
During the public testing phase of the project, the minimum transaction size for Dukascash will be 1,000 tokens, with each token being pegged 1:1 for each of the base currencies it represents. Dukascopy has not yet revealed how long the public testing period will last, or what the minimum threshold will be changed to later.
Dukascash is Not the First, Likely Not the Last
Upon launch, Dukascash will be the third cryptocurrency launched by a major financial institution. The previous two being Signet by New York’s Signature Bank and the JPM Coin launched by multinational banking corp J.P. Morgan. Together with Facebook’s own cryptocurrency Libra, these coins are the first corporate cryptocurrencies, and will likely be responsible for blazing the trail for other financial institutions and tech giants to follow.
Likewise, even Goldman Sachs is reportedly eyeballing the cryptocurrency sector and is said to be conducting extensive research into the ‘tokenization’ of assets. The CEO of Goldman Sachs, David Solomon speculates that the emergence and subsequent adoption of bank-backed cryptocurrencies will likely result in more favorable regulations.
David’s prediction about improving regulations appears to be already ringing true, according to recent reports that G20 policymakers are rethinking their stance on the cryptocurrency sector. With Bitcoin adoption soaring again and with so many large corporations getting involved, the changes of a global standard regulatory framework for cryptocurrencies is better than ever before.
What is your opinion on Dukascopy’s new Dukascash cryptocurrency? Is there any need for another fiat pegged stablecoin? Let us know your thoughts in the comments below!
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