Blockchain company Coinfix which recently launched a US dollar-backed digital currency called USC, based on smart contract issuance, is considering launching further cryptocurrecncies backed by other legal tender currencies.
Unlike Bitcoin, Ethereum and other cryptocurrencies, USC has a 1:1 exchange for the dollar.
Coinfix is a project aimed at creating stable digital assets. It is based on the blockchain network of Achain, and is dedicated to helping global users solve the problem of convenient circulation of valuable assets.
“USC and other stable digital currencies enable faster, easier and cheaper cross-border transfers,” says Kevin Yu, founder and CEO of USC. Based on the distribution experience of USC, Coinfix will consider issuing more digital currencies with a 1:1 exchange for legal tenders. The vision of Coinfix is to achieve free and convenient circulation of assets.
USC uses Hong Kong’s Linked Exchange Rate System as a reference and uses legal tender-US dollar as a reserve. USC is issued in strict accordance with the amount of USD held in reserve on the blockchain network of Achain. USC holders can convert back to US dollars for the same rate. When USC is redeemed, the recovered currency is destroyed to keep the 1:1 ratio with reserves.
To ensure a digital currency has sufficient reserve, Kevin Yu says that decentralisation issuance mechanism is the key to ensure a currency is backed by accountability. USC is based on smart contract and it has three strategies to avoid the risk of over-issue.
First, USC uses decentralised issuance mechanisms through smart contract. The USC issuance centre does not have the right to directly issue new USC and every USC is issued only after obtaining approval from more than 50 per cent of USC examining and approving clerks.
Second, USC account application and audit are also being modified through blockchain voting, to maximise the transparency and decentralisation of blockchain, to prevent any risks of mischief.
Third, bank accounts of USC are audited by independent accounting firms. If it does not meet auditing standards, new USC cannot be issued. Accountability is thus bolstered by transparency.
Yu says: “Our innovative technology makes cross-border remittances as easy as sending e-mails.” USC will enable users anywhere in the world to make instant transfers within 30 seconds. Transaction charges are as low as 0.01ACT, which is around USD 0.005.
Connecting with the Achain platform is a major advantage of USC. This smart contract network provides a transactional efficiency of 1000TPS (transaction capacity per second). Moreover, Achain-based USC will remain completely unaffected by the price of ACT, charging users a small amount of GAS, and costing less.
Digital currency prices have soared this year. While this may partly be the result of a price bubble, undoubtedly the underlying blockchain technology contains disruptive forces. There is a need for applications that not just leverage the strengths of blockchain technology, but also learn from the shortcomings of previous platforms. Industry experts said that blockchain will be used more widely for transaction settlement and clearing, and blockchain-based payment technologies represented by Coinfix may be a breakthrough.
Coinfix will set up a global super payments centre in the future, offering solutions based on blockchain technology, enabling the secure and quick distribution of valuable assets (bitcoin, precious metals, crude oil, etc). “Coinfix does not rule out the launch of several new types of digital currencies in the future, such as EUC (euro), CBTC (bitcoin), AUC (gold) and so on,” Yu says.