Crypto Exchange Gemini Launches a Regulated Dollar-Backed Stablecoin

On Monday (10 September 2018), digital asset exchange Gemini, which was founded in 2014 by Cameron and Tyler Winklevoss, announced that it had launched the "Gemini Dollar" (GUSD), a dollar-backed stablecoin built on .

The Gemini website says:

  • The Gemini dollar is the world's first regulated (by the New York State Department of Financial Services) stablecoin (combining "the creditworthiness and price stability of the U.S. dollar with blockchain technology and the oversight of U.S. regulators").
  • You can get Gemini dollars 1-to-1 for U.S. dollars on the Gemini exchange.
  • Gemini dollars can be used on the Ethereum network.
  • The issuer is Gemini Trust Company (a New York trust company).
  • U.S. dollars corresponding to the Gemini dollars in circulation are held at a U.S. bank, and are eligible for FDIC “pass-through” deposit insurance (federal deposit insurance coverage that applies to the interests of owners or beneficiaries in a qualified fiduciary or custodial account).
  • "The U.S. dollar deposit balance is examined monthly by an independent registered public accounting firm to verify the 1:1 peg."
  • "The Gemini dollar is a cryptographic token built on the Ethereum Network according to the ERC20 standard for tokens."

The following two diagrams was used to illustrate how the process of getting Gemini dollars and U.S. dollars works:

How GUSD Works.png

How GUSD Works 2.png

In a post on the Gemini blog, Cameron Winklevoss described the motivation for the Gemini dollar:

While cryptocurrencies operate 24/7/365 (similar to email), fiat currencies only operate during specific “business hours” (like snail mail) — a fundamental mismatch. As a next step in our mission, we must improve the linkage between these worlds by giving fiat currency the same desirable technological qualities of cryptocurrencies.

According to a report in MarketWatch, the U.S. dollars will be held by State Street Bank, and the deposit balance will be audited monthly by BPM, one of the largest California-based accounting and consulting firms in the U.S., to to ensure that there is a U.S. dollar for every Gemini dollar in circulation.

Anthony Pomplianao, Founder & Partner at Morgan Creek Digital, had this to say about the Gemini dollar:

Interestingly, today, another regulated stablecoin got announced. Blockchain startup Paxos launched Paxos Standard (PAX). Like the GUSD token, the PAX token is built on the Ethereum blockchain, is fully collateralized 1:1 by the U.S. dollar, issued by the Paxos Trust Company, and approved and regulated by the New York State Department of Financial Services.

These two new stabecoins will be competing with existing stablecoins such as Tether (USDT), TrueUSD (TUSD), and Dai (DAI). Currently, Tether is the most traded stablecoin, but it is controversial for two reasons: there is a concern in the crypto community that it is not fully backed by U.S. dollars (a concern that does not want to go away since Tether refuses to disclose the names of the banks holding its U.S. dollars); and there is also the concern in the community that Tether is allegedly being used for market manipulation.

Featured Image Courtesy of Gemini Trust Company

Theta Network's THETA and TFUEL Tokens Are Up 437% and 630% in 2020

Siamak Masnavi

THETA and TFUEL, the governance and operational tokens of Theta Network protocol (developed by Theta Labs), which is designed to address the problems with existing solutions for live video streaming. Both of these cryptoassets have experienced tremendous price appreciation in 2020. 

Theta's solution is decentralized peer-to-peer (P2P) video delivery powered by its own native blockchain (which uses Multi-BFT Consensus), which in turn is powered by the users. As you watch your favorite live video streamers, or when you are not using your computer, Theta uses your spare upload bandwidth to relay streams to other users in your local area, and rewards you with TFUEL tokens.

The Theta mainnet was launched on 15 March 2019, but it was back on 14 February 2019 when Theta Labs explained via a blog post the difference between Theta Token (THETA) and Theta Fuel (TFUEL) token:

Theta Labs said that THETA is the governance token of Theta protocol, and that it is used "to stake as a Validator or Guardian node, contributing to block production and the protocol governance of the Theta Network." Users earn "earn a proportional amount of the new TFUEL generated" by "staking and running a node." THETA has a fixed maximum supply of one billion.

As for TFUEL, it is the operational token of Theta protocol. TFUEL "powers on-chain operations like payments to relayers for sharing a video stream, or for deploying or interacting with smart contracts," and it is earned by relayers "for every video stream they relay to other users on the network." 

Both THETA and TFUEL are native tokens of the  Theta blockchain.

These two cryptoassets have been two of the best-performing cryptoassets in 2020 as the two TradingView price charts (for the year-to-date period) below illustrate:

THETA-USD TV Chart on 27 May 2020.png

TFUEL-USD TV Chart on 27 May 2020.png

The THETA price has gone up over 437% against USD (to reach $0.468)  in the YTD period. As for the TFUEL price, it has increased over 630% to $0.0146.

THETA and TFUEL are currently ranked #27 and #93 by reported market cap.

There are three reasons for such amazing price appreciation in 2020:

  • Rapid growth in the number of users of decentralized video streaming platform Theta.TV due to multiple new partnership deals (such as with Samsung and NASA) and the growing demand for entertainment from all the people forced to stay at home due to lockdown measures introduced as the result of the current COVID-19 pandemic. In particular, Theta.TV has been hosting several important virtual blockchain conferences in the past few weeks, most notably Coindesk's Consensus: Distributed conference.
  • The upcoming launch of version 2 of the Theta Mainnet (this is expected to go live around 22:00 UTC on May 27).

Interestingly, the day for Theta's network upgrade (which is supported by Binance) coincides with the day on which NASA and Elon Musk's SpaceX are launching the Falcon 9 rocket:

Update at 13:40 UTC on May 27:

According to a report by Coindesk, Google is "teaming up with Theta Labs in a move meant to help the video delivery network onboard users through Google Cloud." The report goes on to say that Google will "become the protocol’s fifth external validator node, staking 5 million THETA tokens (worth about $2.4 million at a press-time price of $0.48 each) on the network."

Theta Labs CEO Mitch Liu is hoping for further collaborations with Google:

“YouTube is particularly interesting because they utilize mostly internally-developed technology for video delivery and streaming, which makes experimentation a lot easier without having to rely on external platforms like Akamai or AWS."

The announcement seems to have given THETA token's price another push, as you can see from the 24-hour THETA-USD price chart (from CryptoCompare) shown below:

THETA-USD 24 Hour Chart on 27 May 2020.png

Featured Image Courtesy of Theta Labs