Some of the leading crypto firms have formally formed an alliance aiming to encourage digital asset users worldwide to adopt stablecoin. Robinhood, Kraken, Galaxy Digital, Anchorage Digital, Bullish, Nuvei, and Paxos joined forces to launch a new stablecoin known as the USDG, or the Global Dollar Network., helping the integration of stablecoin in everyday financial transactions.
A New Stablecoin Network
The partnership between Robinhood, Kraken, Galaxy Digital, Anchorage Digital, Bullish, Nuvei, and Paxos gave birth to the open network named the Global Dollar Network.
According to their joint statement, the new network was created to accelerate stablecoin’s worldwide usage. These leaders in their respective industries, united by one goal, will pool their resources and utilize their expertise to push for a wider adoption of the coin, making it a more global digital currency.
The consortium urged other firms, custodians, payment tools, crypto exchanges, and other platforms to become part of the newly formed stablecoin network so they can work together to innovate global money.
USDG, a new US-dollar denominated stablecoin is finally here, and I couldn’t be more excited about @Anchorage Digital’s role.
As an initial partner, we’re making sure institutions have everything they need to confidently engage with USDG.
https://t.co/QoWEuPxMtE
— Nathan McCauley (@nathanmccauley) November 4, 2024
Anchorage Digital, one of the pioneering members of the network, is thrilled about what the future holds for the partnership. The company’s CEO, Nathan McCauley said that their firm supports the introduction of the Global Dollar Network, saying that the stablecoin bloc would greatly benefit the coin’s users.
“Institutions gain an incredible set of opportunities with stablecoins: fast peer-to-peer and cross-border settlement, efficient trading capability, and the chance to earn rewards on select stablecoin deposits,” McCauley said.
USDG Stablecoin
With the collaboration, the new network will issue a new stablecoin called USDG which will be pegged at one is to one to the greenback.
The stablecoin bloc aims to contest the status quo in the digital asset market which is currently dominated by Circle’s USD Coin (USDC) and Tether’s USDT. With the arrival of USDG, it has the potential to reshape the stablecoin landscape.
According to CoinGecko, 90% of the stablecoin’s total market capitalization consists of USDC and USDT.
Kraken Co-CEO Arjun Sethi said that the industry has not reached its potential because there is a lack of competition in the regulated stablecoin market, claiming that USDG would upend this dynamic since the new stablecoin offers a more equitable model.
Sethi adds, “It will bring mainstream participants into the ecosystem and accelerate new stablecoin use cases.”
Bullish CEO Tom Farley, on the other hand, said that the network has increased the number of “trusted” stablecoins to choose from.
“Trusted stablecoins are essential in bridging the gap between crypto and traditional markets,” Farley added.
The Dollar Network’s Importance
Stablecoins, which are backed by traditional currencies, are created to keep a constant value.
These digital assets are usually utilized to turn crypto coins into traditional currencies since the token is not affected by wild price fluctuations like in other digital currencies.
Paxos CEO Charles Cascarilla explained that stablecoins are used to re-platform the financial system by revolutionizing the interaction between people and the US dollars, adding that the Global Dollar Network will incentivize the usage of stablecoin and accelerate its adoption in society.
Featured image from Pixabay, chart from TradingView
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