Ever since Bitcoin was created by pseudonymous founder, Satoshi Nakamoto, both public and private entities have been making a case for different digital assets over the years. In a new update that was made available by Reflexer Labs yesterday, the firm announced that it launched a new stablecoin on the Ethereum blockchain.
In the update that was sent out, the lab mentioned that even though we have seen various stablecoins get tied to different currencies over the years, their stablecoin will not be tied to any fiat currency. Giving their reasons for doing that, the firm mentioned that stablecoins should show that they are stable without being pegged to the United States dollars.
Reflexer Labs CEO says the stablecoin would not be backed by any commodity
According to the founder of Reflexer Labs, Stefan Ionescu, so many decentralized finance space projects have to wake up and start thinking about how the space can run without pegging tokens to the dollar. He mentioned that this new stablecoin, RAI will show them that this can happen. Stablecoins have been able to gain their pride over the years because they are being tied to certain fiat currencies or commodities in the market.
One of the most famous stablecoin that is presently doing well in the market is that of Tether, USDT which is pegged to the US dollar. With Tether pegging their token to the United States dollars, it means that no matter the movement of the market, the price of each token will be worth one dollar.
With the RAI not being pegged to any commodity or fiat currencies, the developers are confident that the stablecoin would be able to boast of a stable price as the days roll by. The developers said that they are hoping to use a price controlling method to stabilize the price of the token so it would remain stable even if the price of Ethereum fluctuates.
Co-founder of Reflexer Labs says the coin could be the answer to various problems in the DeFi sector
The main aim of this token at the point of creation was to create a stablecoin that can be strong enough to retain its price mo matter what happens in the market. Making his case in the argument, the co-founder of Reflexer lab, who also doubles as the Chief of SpankChain, Ameen Soleimani said that this new token could have very good use cases in the Ethereum ecosystem. Also, Soleimani mentioned that the token could go well amongst several protocols in the DeFi sector and can even be used as a standard in the Ethereum market.
Looking beyond the decentralized finance sector, Soleimani also mentioned that the token might have greater use cases in the outside world. “What we are hoping for RAI is that it would be used in the DeFi sector, and if that happens, it could be on its way to adoption on a global scale. It could also solve other problems in the financial sector such as Triffin Dilemma and allow neutrality in the making of a stable reserve digital asset”, he noted. During its test phase, the digital asset price saw a fluctuation of nothing more than 4%, with the price of Ethereum living from $400 to $1,400 used as a yardstick.