Stablecoin-as-a-Service (SCaaS) provider Stably has unveiled Stably USD (#USD), the first stablecoin operating on the Bitcoin network, according to a May 25 press release.
The move introduces #USD as a native BRC20 token to the Bitcoin blockchain. It is an expansion of the Bitcoin Ordinals ecosystem, which was made possible by the network’s Taproot upgrade in November 2021.
Stably is a Seattle-based fintech firm that provides fiat on/off-ramp infrastructure for Web3 projects.
It is backed by several notable investors, including Morgan Creek Capital, BEENEXT, 500 Startups, Hard Yaka, CREAM Labs, Sunny Lu of VeChain, and Paul Stahura of Donuts, Inc.
BRC-20 tokens take center stage
BRC-20 tokens utilize a mechanism known as ordinal inscriptions to append data to individual satoshis, Bitcoin’s smallest unit. These satoshis are then individually identifiable and can represent a wide range of entities, including NFTs and, now, stablecoins.
The lack of stablecoin functionality has been a strict limitation on its functionality. DeFi markets operating on Ethereum rely heavily on stablecoins as an integral part of their ecosystems, providing a settlement unit that can be tracked against fiat markets. Until recently, Bitcoin did not have this capability.
While some have hailed the Ordinals ecosystem as a liberating moment in Bitcoin’s history, others have criticized expanding Bitcoin’s use case beyond that of a unit of exchange. In either case, the introduction of a stablecoin to the Bitcoin network is a watershed moment.
Stably claims that each #USD token is backed one-for-one by USD held by a U.S.-regulated custodian in a collateral account for the benefit of token holders who have undergone KYC/AML processes. It also stated that third-party attestors would conduct monthly reports to ensure that #USD tokens are always fully collateralized with USD.
Stably reported that #USD can be issued and redeemed via multiple platforms like Fedwire, SWIFT, USDC, and USDT by KYC-verified users across 200+ countries/regions, including up to 44 US states. For the initial launch of #USD, the issuance/redemption process will be manual.
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