Former Consensys employee Jack Jia, the founder of Stable.com, has recently launched a new stablecoin called USD3. This stablecoin is created as a “payments-first” solution, despite the current absence of a clear regulatory framework and uncertainties within the market.
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USD3 Stablecoin Launch
The USD3 stablecoin is backed 1:1 and is designed to function as an extension of the U.S. dollar for global commerce and Web3. Jack Jia introduced the stablecoin at the Consensus 2024 event taking place in Austin, Texas from May 28 to 31.
Key Features of USD3 Stablecoin
The stablecoin USD3 is built on Ethereum, Polygon, Avalanche, and Linea. Stablecoins are digital assets that maintain a stable value by being pegged to a reserve asset, such as fiat currency (in this case, the U.S. dollar) or other commodities like gold or cryptocurrencies.
Uses of Stablecoins
Crypto traders commonly use stablecoins for trading, borrowing, and lending in the decentralized finance (DeFi) sector. Additionally, stablecoins provide individuals in regions where accessing U.S. dollars is difficult with a stable alternative.
Goal of USD3 Stablecoin
Jack Jia aims for USD3 to overcome challenges faced by previous players in the stablecoin market and emphasizes future-proofing the stablecoin. The vision is to achieve mass adoption of USD3 and establish it as a foundation for a new global payment system.
Well-Known Stablecoins
Among the most recognized stablecoins are Tether (USDT) and USD Coin (USDC). Tether is widely utilized within the crypto market, maintaining a 1:1 value ratio with the U.S. dollar. Similarly, USDC is another prominent stablecoin used for trading and transfers within the crypto ecosystem.
Stablecoin Regulation
In the U.S., the Lummis-Gillibrand Payment Stablecoin Act was recently introduced to provide regulatory clarity within the stablecoin market. Clarity in regulations is expected to drive broader adoption of stablecoins, as seen with the potential increase in U.S. stablecoin adoption following regulatory adjustments.
In Europe, the Markets in Crypto Assets Regulation (MiCA) guides stablecoin issuers to comply with set regulations. However, the lack of clarity has led to exchanges delisting stablecoins like Tether’s USDT, such as OKX discontinuing support for USDT in the European Union and European Economic Area.
Overall, the launch of USD3 and the evolving regulatory landscape highlight the dynamic nature of stablecoins in the crypto market, aiming to bridge the benefits of digital currencies with the stability of traditional assets.
