London Block Exchange Launches First-Ever GBP-Backed Stablecoin
London Block Exchange has worked with AlphaPoint to launch the world’s first stablecoin pegged to the Great British Pound (GBP). The backing entails a one-to-one ratio where the funds are fully secured in an auditable, UK-based bank account.
Details of the World’s First GBP-Backed Stablecoin Explained
The London Block Exchange is a multi-cryptocurrency exchange with a specific focus on the UK market. According to a recent announcement, they have partnered with AlphaPoint for the initial mining, minting, and use of the world’s first pound sterling (GBP) stablecoin: GBP-Peg (GBPP).
Stablecoins aim to minimize the high price volatility seen in cryptocurrencies. The value of a stablecoin is usually pegged to a traditional fiat currency or precious metals such as gold and silver— which fluctuate much less than digital currencies.
Previously, stablecoins have primarily been tied to either the USD or the EUR when it comes to fiat currencies. Now, they will also be available through the pound sterling, which is unofficially referred to as the Great British Pound, the official currency of the United Kingdom.
How the GBPP can Bring Added Benefits to the Digital Asset Space
The London Block Exchange has partnered with AlphaPoint to introduce the new currency, GBPP. A segregated, onshore, and auditable UK bank account has been stocked with GBP, to serve as a one-to-one ratio for the GBPP. As reported by the London Block Exchange,
“All GBP held in this account is represented by an equivalent number of GBPP tokens on the blockchain. GBPP and a future suite of stablecoins based on additional fiat currencies such as the Euro and the U.S. Dollar, will also leverage AlphaPoint’s asset digitization technology.”
London Block Exchange CEO Benjamin Dives also provided specific comments on benefits that stablecoins bring to the digital asset industry.
“GBPP will help boost mainstream usage of other cryptocurrencies by allowing investors to realize the technological benefits of instantaneous transactions, decreased volatility, and increased liquidity. We are excited to partner with AlphaPoint, a globally trusted brand with technology that will help us deploy and maintain a robust network in a trusted and compliant manner.”
Many industry experts conceive of stablecoins as an efficient solution in combatting the issue of volatility. Some even believe that governments will issue stablecoins within the following years.
Whether or not that happens is yet to be seen. Currently however, what can be seen is blockchain’s continued expansion to real-world assets.
Security tokens have seen a significant increase in 2018, with many predicting the Security Token Offering (STO) to not just replace the ICO, but the IPO.
For more on the benefits of security tokens, be sure to check out our comprehensive security token guide.
What do you think of the new GBP-backed stablecoin? Will stablecoins survive as a long-term solution to the volatility seen in cryptocurrencies? We’d love to know your thoughts in the comments below.
Image courtesy of London Block Exchange.