An Overview of Stable Crypto Tokens

The high volatility of digital currencies is the reason why using another digital coin as a unit of account is not the best idea. For example, Bitcoin’s price changed by 10 percent in one day, while Ethereum’s price changed by 20 percent in a single day several times. A stablecoin is an asset that has price stability characteristics making it suitable for use as a unit of account and store of value. Some of the leading stablecoins are described below.

TETHER – USDT

Tether is a cryptocurrency asset issued on the Omni Layer blockchain — a fork of the Bitcoin blockchain — that is backed 1:1 with a U.S. dollar in the reserves of Tether Limited. USDT is the most popular stablecoin on the market, showing its transparency on https://wallet.tether.to/transparency.

There is no fee for transferring USDT between wallets, while the fee for transferring to a bank account is 0.1 percent of the total transferred or $20.

DigixDAO

Just as USDT is backed by U.S. dollars, DigixDAO is backed by real gold. Established in 2016 in Singapore, it is one of the first Ethereum-based projects with two tokens: the DGX token, where 1DGX = 1 gram of gold, and DGD tokens that give you the opportunity to pledge on DigixDAO with the goal of increasing DGX adoption and fluctuate based on exchange rates and market forces. As far as transparency goes, there is no way of verifying it online, but  Inspectorate Bureau Veritas “provides quarterly audits of every single Gold asset in our Safe House vaults.”

DigixDAO fees for transferring from wallet to wallet are 0.13 percent of the total amount in addition to a demurrage fee of 0.6 percent whereby 0.2 percent goes to DigixDAO and 0.4 percent goes to the storage.

OROCOIN – ORG

OroCoin is a unique cryptocurrency that is on its way to becoming a new gold standard in the industry. With a Scrypt PoW consensus algorithm, it promises to reward every mined block with the following formula: price of gold at the time of mining x 1 OroCoin/100. This will halve every 800,000 blocks (price of gold at the time of mining x 1 OroCoin/200). For example, if the price of gold is currently $1,143, then the block reward will be 11.43 OroCoins.

GOLDBLOCKS

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XAURUM

Xaurum is one of the first gold-backed cryptocurrencies. It represents an increasing amount of gold and can be mined cooperatively and profitably on the Goldmine. Xaurum is coined by exchanging the mined value of physical gold that is stored as the CommonWealth gold reserves. It was initially coined on a PoS Blackcoin blockchain before transitioning to Ethereum.

Xaurum doesn’t provide an opportunity to buy back XAUR coins for fiat money, but you can “melt” your coins to receive physical gold.

The minimum transaction fee for sending XAUR coins is 0.00061213 ETH. However, if you wish to “melt” your coins, additional fees will be required (0.5 XAUR per transaction) in order to secure the international transport of the gold — depending on the quantity and your location.

ONEGRAM

OneGram is a gold-based cryptocurrency predicated on Sharia and Islamic finance. It is creating its own payment gateway called YalaPay and issues a custom MasterCard linked to a user’s OneGram wallet. Each OneGram coin is backed by one gram of 999 standard gold, with the OGC’s price being calculated by the following formula:

OGC Value = GV + TF + DP

Where:
GV = Gold Value
TF = The present value of the transaction fees reinvested to buy more gold
DP = Demand Premium, where the value is determined by market demand

Each OneGram transaction generates a 1 percent transaction fee topping out at a maximum of 1 OGC, and every OGC can be exchanged for physical gold. With that said, there is no information regarding the fees of this operation.

OzCoinGold

OzGold is a U.S. company built on Ethereum’s blockchain that has 100,000 oz (approximately 2800 kg) of gold secured and stored in an Australian gold storage facility with no storage fees. There are a total of 10,000,000 OzGLD coins.

As far as the fees go, even if we don’t have an exact number, there is the following statement on OzGold’s website:

“Transaction fees are lower that any alternative way of purchasing gold and zero fees payable on initial purchase from www.ozgld.com.”

Although the currency is backed by gold, you will not be able to exchange it for a period of five years, starting on March 1, 2017. However, you are the sole and 100 percent anonymous owner of the gold and can freely transport it over any border.

Royal Mint Gold

Royal Mint Gold, or RMG, is the name given to a new gold investment product that will be provided by The Royal Mint. This product is real gold that is stored in The Royal Mint vault and traded on a digital trading platform provided by CME Group. The Royal Mint will not sell RMG directly to consumers, but its new product will instead be available to investors through third-party intermediaries such as banks and brokers.

To make RMG possible, the world’s leading mint exporter has partnered with Chicago Mercantile Exchange (CME Group), the largest and most diverse derivatives marketplace in the world. CME Group has developed the trading platform that RMG will be traded on and has been working with partners AlphaPoint and BitGo to develop the technology and blockchain ledger. The trading platform and blockchain technology allow gold to be traded in a real-time, cost-effective and secure way.

RMG will be physically inspected and certified by independent auditors at least every six months.

“The physical gold that the RMG in issue represent is held on an allocated basis in a secure vault and is owned by the RMG holders. The Royal Mint acts solely as custodian of the gold which can delivered to a RMG holder at his/her request. The Royal Mint has no claim on the gold.”

GoldMint

GoldMint is a blockchain-based platform that uses GOLD digital assets, which are 100% backed by physical gold. The company plans to bring a stablecoin to the turbulent world of cryptocurrencies.

GoldMint will have two tokens issued, the main one being the GOLD cryptoasset that is 100 percent secured by physical gold and ETF. The second token, MNT, is going to be used by miners as a stake to create a block and include it on the chain. Miners will receive 75 percent of transaction fees included in confirmed blocks.

Initially, GoldMint will sell MNTP(MNT pre-launch) tokens issued during the ICO on Ethereum’s platform, and as soon as GoldMint’s blockchain is ready, all MNTP holders will be able to exchange them for MNT.

The company is creating Custody Bot, a vending machine that is intended to receive, appraise, store and deliver physical gold. Custody Bot is planned to be fully automated, connected to blockchain and used as a replacement for current pawnbrokers.

GoldMint is quite different from the other stable coins that are around. The platform has realized that there needs to be a connection between the physical and the virtual world for an economy to flourish, as the digital assets are used to meet the needs of real people in their day-to-day lives. With Custody Bot, the platform has created the much-needed interface between both worlds.

By way of implementing Custody Bot, the platform has given more control to the users to handle both “real” gold and GOLD tokens themselves, without having to rely on some reserves, claimed to be held by the platform in an undisclosed location.

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