Bitcoin-Backed Stablecoin Launches on the Ethereum Blockchain

[fitload]

A new stablecoin called Wrapped Bitcoin (WBTC) has been launched on the Ethereum Blockchain and will offer cross-chain trading options. However, this one is backed not by a fiat currency but by the world’s number one cryptocurrency, Bitcoin (BTC).

The project was first unveiled in October as a joint initiative between decentralized exchange startups Kyber Network and Republic Protocol, as well as cryptocurrency custody company BitGo.

According to the team staying behind the project, WBTC is intended for ensuring greater liquidity to the Ethereum ecosystem in general including financial apps and decentralized exchanges.

At the time, BitGo CTO Benedict Chan described WBTC as possessing both “the stability of bitcoin and the flexibility of Ethereum,” likening the new crypto asset to traditional bank notes (the kind that was once redeemable for gold).

While volatile compared to the U.S. dollar, bitcoin is the most liquid and stable of cryptocurrencies with the highest market capitalization, he noted.

The price of WBTC as listed on the CoinMarketCap website is $3,506 compared to Bitcoin’s price which...

Read More: https://bitzamp.com/bitcoin-backed-stablecoin-on-the-ethereum-blockchain/

[Fenix]

I doubt a little about the need for such a kind of "stable" coin, which will be supported by Bitcoin. I just do not understand the need for the existence of such a coin. On the one hand, it will not be stable in relation to the usual fiat currency, and on the other hand, why in this case simply do not buy Bitcoin. The presence of another intermediary in the cryptocurrency on the ethereum chain will only increase the risk of using such a "stable" coin.