OKCoin to Issue Yuan-Backed Stable Coin
It seems the stable coin frenzy has set to continue with Chinese crypto exchange OKCoin set to issue Chinese Yuan-backed stable coin.
Due to unwanted extreme volatility in the crypto markets, many authorities thought this kind of stable coin projects could tackle and give the markets much-needed stability.
During this latent event, OKGroup founder Star Xu, who also reportedly a subject of criminal investigation before, announced that they are going to launch Yuan-backed Stable coin.
Yesterday, he replied one of the tweets mentioned to him as he said:
Embracing the tide of technology, the launch of a #CNY backed #stablecoin is an inevitable trend, and it will significantly improve the internationalization of the RMB. OKCoin USA will launch a fully compliant stablecoin.
Some of the market participants have been constantly criticized stable coin projects because they think these projects will favor more centralization than the decentralization.
Despite that, Xu stated this kind of stable coin projects are necessary because they are very integral part of how the cryptocurrency markets work. Xu said Yuan backed asset could help bolster the cryptocurrency economy, and global overall.
“Today, the amount of cash in China’s domestic monetary system is not small. A dollar-pegged stablecoin regulated by the US government will strengthen the penetration of the US dollar 100 fold. Embracing this tide of technology, the launch of a CNY backed stablecoin is an inevitable trend, and it will significantly improve the internationalization of the RMB.”
Regarding the negative side of that, many believe this frenzy is perfectly similar to ICO craze that happened back in the end of 2017. Lots of ICO’s raised a lot of money without ever offering a solution and at the end, lots of projects failed miserably.
Speaking about the matter during Cambridge’s Extraordinary Future 2018 conference, book writer Alex Tapscott has criticized stable coins. Tapscott, who wrote Blockchain Revolution book, said:
“I’m kind of skeptical on stablecoins because what they do is create intermediary and counterparty risk. So you have this coin that you can spend super easily, but in the end, it needs to be redeemable for some asset. So whoever holds that asset, holds the risk.”
It is pretty easy to see lots of projects have been launched right now. Only time will tell how many of them will be successful.