LBX Launches LBXPeg, the First GBP-Collateralized Stablecoin

Siamak Masnavi

On Saturday (29 September 2018), London Block Exchange (LBX) announced that it was launching LBXPeg, the first 1:1 GBP-collateralized stablecoin.

LBX opened in November 2017; it offered an OTC crypto trading service and a mobile app that allowed UK-based customers to buy and sell BTC, ETH, LTC, XRP, and a variety of other cryptocurrencies.

Here is what you need to know about LBXPeg:

  • Tied to the value of the British Pound (GBP);
  • Fully backed by GBP reserves (held in an auditable UK bank);
  • Implemented as an ERC-621 token on the Ethereum blockchain (ERC-621 is an extension of the ERC-20 standard that allows increasing or decreasing the token supply; this was needed in order to have the "required flexibility in the total supply to match the quantity of GBP held in the segregated bank account");
  • Will also be issued on other blockchains (providing that "compliance controls can be maintained"); and
  • May have variants in future that are pegged to the dollar or the euro;

LBX's press release says that LBX developed LBXPeg in response to growing demand in the crypto market for stablecoins. It accuses many of the existing stablecoins of having "opaque management structures, distribution schedules and auditing processes." It also says that LBXPeg will allow easy and quick transfer of cryptopounds, which will make it suitable for a wide range of use cases.

LBX's CEO, Benjamin Dives, said in an interview with Business Insider that the GBP reserves "will also be regularly audited by a top accountancy firm" and that the first cryptopound will be "minted in the next 10 days." Here is how he described what he sees as the main use cases for LBXPeg:

"The primary use case will be settlement for OTC trades in the London market, then commonwealth exchanges where they don't have fiat banking, and then securities tokens who want to pay dividends in a cryptopound."

LBX's announcement comes at a time of increasing interest in stablecoins. In the past few weeks, as covered by CryptoGlobe, at least three new major fiat-backed stablecoins have launched: the Gemini exchange's "Gemini Dollar"(GUSD), Paxos' Pax Standard (PAX), and Circle's "USD Coin" (USDC)

Featured Image Courtesy of London Block Exchange

Bitcoin Mining Pool Tries to Help Tone Vays Win $10K Bet Against Roger Ver

Cryptocurrency mining pool SlushPool has recently manually added a BTC transaction into a block to help Tone Vays, a derivatives trader and analyst, win a wager mage against BCH proponent Roger Ver.

The wager was made at the 2019 Malta AI & Blockchain Summit, during a debate between bitcoin (BTC) proponent Tone Vays and Bitcoin.com CEO and BCH advocate Roger Ver. In it, Ver argued BTC transactions are too expensive for business use due to the cryptocurrency’s small block size.

Vays, on the other hand, argued segregated witness (SegWit) and second-layer scaling solutions like the Lightning Network allow users to make small transactions without paying high fees, and that he has been using BTC on-chain without paying too much for transactions.

The debate ended up seeing Vays send Roger Ver $5 worth of BTC with a one satoshi per byte transactions fee – equal to the fees paid on the Bitcoin Cash chain – to see if it would confirm the same day. If it did, the CEO of Bitcoin.com claimed he would donate $10,000 to a charity of Vays’ choice.

During the debate, both parties noted the transaction was “priority 23,836 out of 24,355 transactions,” meaning that most transactions on the Bitcoin blockchain had to clear before miners picked that one up, at least according to fees paid for transactions.

As Vays soon noted on social media the transaction cleared after 10 hours. Some, however, found it strange. Cobra Bitcoin, the pseudonymous co-owner of Bitcoin.org and Bitcointalk, pointed out on social media that SlushPool – the mining pool that found the block the transaction was included in – manually added it to help Vays win the bet.

Cobra Bitcoin figured it wasn’t mined “naturally” as it was the second transaction included in the block – right after the coinbase transaction – despite the fee being less than 1% of that of all other transactions included in the block.

On Reddit, users pointed this out and accused SlushPool of manually adding the transaction. The mining pool, according to some users, is known for supporting BTC and being against Bitcoin Cash.

Should Roger Ver Pay?

The wager quickly became a controversial topic that seems to bring back memories of the scaling debate that was going on before Bitcoin Cash forked off of the Bitcoin network back in August of 2017.

Some argue that Roger Ver’s point stands as the transaction wasn’t “naturally” confirmed, but manually included in a block. Moreover the CEO of Bitcoin.com claimed he’d donate the money if it confirmed that day, and when the transaction did confirm it was past midnight in Malta.

On the other hand, some claim the transaction did go through anyway, and as such Roger Ver should donate the funds to a charity of Tone Vays’ choice. Moreover, Vays himself argued BCH supporters could have spammed the BTC mempool with two satoshis per byte transactions to stop his from clearing on time.

On Twitter, Vays created a poll that was retweeted by SlushPool and admitted the mining pool did prioritize the transaction. It currently shows most users believe Roger Ver should donate the funds. As one commenter pointed out, however, the results may change if Ver and other BCH supporters retweet the poll.