Stablecoins: Noku Sponsored an Awesome Event in London
It has been exciting to attend the awesome event ‘Stablecoins: Collaboration Towards Mass Adoption,’ organized by Stable.report last Thursday at the Reform Club in London. Stablecoin issuers, lawyers, investors, and other stakeholders had the occasion to build relationships, share information, collaborate, partner and raising public awareness on the path towards achieving a decentralized economy.
During the morning, a closed-door event focused on stable coin issuers took place. The participants also took a leading role in three panels: Market enablers, Standards and Audits, Lobbying and regulation. The afternoon session has been open-door for all stakeholders involved in the industry.
What is a ‘Stablecoin’?
In general terms, a token can be considered ‘stable’ if it is pegged by a centralized asset (such as a FIAT currency, gold, real estate) or a decentralized asset (such as another cryptocurrency,) or if an algorithm guarantees its stability.
According to a survey conducted by Stable.report, 30% of stablecoins are based on centralized collaterals, a decentralized asset pegs 61.7% of them, and the remaining 8.3% are algorithm-based.
From a traditional standpoint, stablecoins are backed by a ‘reserve’ (of centralized or decentralized assets,) and this reserve corresponds to the number of tokens in circulation. Therefore, their prices are stable as the assets supporting them are known.
Of course, this doesn’t preclude speculation on exchanges which may create strong pressures alternatively on the supply or demand side, and the stablecoins must have a mechanism in place to handle this market activity.
Stablecoins: the ‘Holy Grail’ of Cryptocurrency?
Even if the concept of ‘stablecoins’ is still relatively new and its taxonomy is far from being collectively accepted, stablecoins have the potential to change the way we make financial transactions radically.
They are global, no tied with central banks and low-volatile at the same time. As stated by some, they could be considered as a ‘transition’ between how cryptos are currently perceived (by the crypto-skeptics) and what they should be—real currencies.
More, they could be a great stepping stone for institutions and institutional investors to get on-board with crypto.
The Event’s Takeaways
The meeting that took place in London last week has been significant to achieve mass adoption of the stablecoins. This conference has shown that the community of stablecoin-issuers (current and future) must demonstrate momentum because the market is available for fast and fruitful development, even if the sector lacks regulation.
Awareness, security, liquidity and technological progress are the priorities the participants identified to stimulate the adoption of stablecoins.
Further, even if it’s still difficult to find standards applicable to all the projects, the market wants transparency. As long as the cryptocurrency industry lacks regulation, investors are cautious when investing in a stablecoin. As Joel Telper, Partner at Sullivan & Worcester LLP said during the event, “Trust is needed. Trust is the only way and the key to bringing stable currencies to the world.”
Stablecoins are a portion of NOKU’s business, and they are also of deep interest for our ToknRaise platform’s users. We have been honored to be part of ‘Stablecoins: Collaboration Towards Mass Adoption,’ and our sincerest thank goes to its organizers Léon Markowitz and Alexander Panasuk once again.
Also published on Medium.