IBM said on Tuesday that in this case, the cryptocurrency called 'Stronghold USD' is covered by the US dollar provided by the Federal Deposit Insurance Corporation, and is managed by Prime, a management company focused on blockchain assets. Trust storage.
IBM said it will experiment with this virtual dollar to explore ways to help banks and other financial institutions process payments faster and more securely. Stabilizing coins are designed to reduce the volatility common in the cryptocurrency market.
Previously, Tether, known as the famous stable currency, sparked a lot of controversy, accused of supporting the price of Bitcoin during the price spike last year.
Due to concerns about its dollar reserves, Tether has also become a controversial target in the field of cryptocurrencies. Worried that Tether Limited, which launched Tether, does not have enough dollars to explain the amount of tokens in circulation.
The move shows that the IT industry with decades of history is being further pushed to cryptocurrency and blockchain technology. Encrypted currency transactions are recorded by blockchain networks.
Earlier this year, IBM partnered with environmental technology startup Veridium to convert carbon credits, a tradable instrument designed to reduce greenhouse gas emissions, into digital tokens. The company also uses digital tokens from blockchain company Stellar. Lumens, making payments between bank consortiums faster.
IBM said that Stronghold's stable currency will rely on Stellar's platform. Stellar was created in 2014 by Ripple's former executive Jed McCaleb.
IBM's blockchain is different from the blockchain that originally supported Bitcoin. Bitcoin blockchains are public, allowing anyone to share, while IBM's blockchain allows only a certain number of trusted parties to use.
According to industry website CoinMarketCap, the entire cryptocurrency market is currently worth more than $270 billion. Since the beginning of the year, the entire market has experienced a sharp decline, the price of the world's most famous digital currency, bitcoin, from nearly $20,000 at the end of last year. The record high fell sharply to around $6,700 this Tuesday.