London Block Exchange to Issue Pound-Pegged Stablecoin

 In Exchanges, Governments and Regulations

The London Block Exchange has announced the imminent launch of  LBXPeg, a new cryptocurrency pegged to the British pound.

The London Block Exchange (LBX), a UK-based over-the-counter crypto-trader and exchange operator, announced on Friday plans to launch a new cryptocurrency pegged to the British pound. Dubbed LBXPeg, the stablecoin has already been approved by an undisclosed banking partner, which will be holding the one-for-one reserves of fiat money.

According to an official LBX blog post, LBXPeg will be an ERC-621 token, building upon the ERC-20 standard. The company explained that it had chosen the Ethereum blockchain due to its transparency, efficiency and the fact that it is “close to reaping the benefits of its upcoming scaling solutions.

LBXPeg will also be issued on other blockchains where compliance controls can be maintained, LBX added. After the “cryptopound’s” initial release, the company will also explore tying the product’s value to accounts which hold other fiat currencies, such as euro and US dollar, “to improve both its scope and stability.”

Elaborating on its exact aspirations for the LBXPeg launch, LBX said:

“LBXPeg is required in the market as although the appetite for stablecoins is growing, trust in current projects remains flat. Through opaque management structures, distribution schedules and auditing processes, many available stablecoin offerings are inadequate for the needs of businesses, traders and consumers. They need a product that they can trust to be managed in a correct and compliant manner.”

Speaking with Business Insider, LBX CEO Benjamin Dives revealed that the first LBXPeg would be minted in the next ten days. He added that the reserves underpinning the coin would be audited by a leading accountancy firm on a regular basis.

“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,” Dives noted.

Stablecoins are becoming the next hot trend in the world of crypto assets. According to a recent research report released by crypto wallet provider Blockchain, there are now over 50 stablecoin projects under development, with some 40% of them already live and around 60% at a pre-launch phase.

Related Article:  Bitcoin Volatility Hits Record Low, Calm Before a Major Short-Term Rally? Experts Weigh In

Just over the past month, three fully legalized digital assets pegged to fiat currencies have become active: the Winklevoss-backed Gemini Dollar (GUSD), Paxos’ Paxos Standard (PAX), and most recently, USD Coin (USDC) by Goldman Sachs-backed Circle.

The influx of stablecoin projects has raised concerns in the crypto community, with skeptics pointing out that they may be the next bubble in the industry.

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