One of the biggest arguments non-adopters have against cryptocurrencies is their volatility. The constant price fluctuations in this market triggered even by the smallest changes is a good enough reason for people to steer clear of digital assets. This greatly undermines the potential of the technology and the positive changes it could bring to our world. So, the crypto market responded by introducing stablecoins as the go-to option for those who want to mitigate risk in the decentralized framework.
The concept of pegging digital assets to real-world assets like gold, fiat currencies, or metals became quite popular, with new investors jumping at the idea. However, unlike other cryptocurrencies, the stablecoin market is not very transparent. Stablecoin issuers have not been very upfront about the assets backing these coins and if there are enough of those assets in reserves. This once again raised questions on the stability of stable coins and put investors in a dilemma.
To solve this once for all, Wallex Trust came up with EURST, the world’s first fully live-audited euro stablecoin. This new stablecoin is poised to change the way stablecoins are perceived in the global financial markets.
Live Audits: The Ultimate Path to Transparency
EURST is an ERC-20 token pegged to the U.S. dollar. It is designed in such a way that 1 EURST token represents a value of 1€ worth of USD. The token was essentially created to revive the failing economies in countries within the European Union where financial systems have not developed enough. EURST opens the doors for people in these countries to get access to and participate in the global financial system.
With quick and easy minting and redeeming, after a successful KYC verification, the platform makes cross-border fund transfers and payments easy and accessible. The need for intermediaries and banks can be efficiently reduced with users being able to store their stablecoins on the platform itself in their custodian Wallex accounts.
While all of this sounds impressive, the real deal with EURST is the live-audits. This is a feat that brings a serious value to the stablecoins. The thing is that stablecoins remain viable only as long as there are an equivalent amount of underlying assets in reserves as the circulating supply. When there are not enough underlying assets, the price is bound to fall, creating instability in stablecoins.
Live-auditing a digital asset allows investors to see what is really going on behind the scenes. They get real-time information on the circulating supply and underlying assets. So, how does this even work?
To facilitate live-audits for investors, Wallex Trust has engaged with Armanino LLP which is one among the largest accounting firms in the US. This live audit system is connected from one side to the escrow account where fiat funds backing the tokens are held, and on the other side, to the blockchain. Then, the on-chain token data is easily linked to create live-audits every second. All users of the platform can easily get access to these live-audits as a downloadable report directly from the auditor’s website.
The fact that the audits are live and real-time makes the whole thing even better. In a market saturated with dated audit reports, real-time audits create an unprecedented level of transparency and trust. They restore investors’ faith in the market and help in unleashing the full potential of the underlying technology.
Addressing Real-World Problems With Stablecoins
Stablecoins like USDT and USDC have remained the undisputed stars of the stablecoin market so far. But their recent price drops and USDT’s changed stance on what’s backing their coins sent shock waves among investors, sabotaging their trust.
Now, with projects like EURST using live-audits to create transparency and trust, the issues within the stablecoin market can be resolved and investors’ trust can be regained. This inturn helps us focus on real economic flaws in our systems, using stablecoins to build better financial facilities for underdeveloped nations.
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