Crypto Exchange Gemini To Launch Dollar-Pegged Cryptocurrency
Gemini, a crypto exchange, is poised to launch a dollar-pegged stablecoin. Apparently, the announcement, which was made on Monday, suggests that it will be made on Ethereum.
Introducing Gemini Dollar
The Gemini dollar is basically meant to offer a liquidity process for people wanting to either send or receive U.S. dollars via the Ethereum network. According to the press release, it will be heavily “pegged” to the dollar, with the Gemini Trust Company being responsible for holding USD deposits in accordance to the number of tokens in circulation.
It is worth noting, too, that the release mentioned the involvement of the New York Department of Financial Services (NYDFS). Basically, the latter has reportedly reviewed and approved the aforementioned dollar.
The digital asset exchange maintains that there has yet to be a “trusted and regulated” cryptocurrency representation of the U.S. dollar. This is most especially true when it starts to move in an open and decentralized manner, which is exactly what a digital currency is all about.
Reviewing Bank Holdings
To guarantee and safeguard the holdings, Gemini will ensure it holds the fiat currency that backs the stablecoin in the U.S.-based State Street Bank. Even more so, it will be insured through the help of the Federal Deposit Insurance Corporation (FDIC)’s so-called “pass-through” deposit insurance program. Apparently, there will be done within certain limits.
The overall process will also see the works of independent auditor called BPM Accounting and Consulting. According to the press release, it will be in charge of reviewing the firm’s company’s bank holdings and it will be done on a monthly basis. Above all, Gemini intends to make all audits available to the public.
Tyler Winklevoss, the co-founder of Gemini, was quoted saying: “The Gemini dollar is part of our mission to build the future of money … It is the missing link between the traditional banking system and the crypto economy.”
Customers who choose to register with Gemini are said to have the ability to convert USD into Gemini dollars. At the same time, they can deposit them as long as it is an Ethereum address from 10:00 EST Monday. Moreover, they can start converting tokens back into USD, something that can be done by depositing them into their respective Gemini accounts.
With the move, Gemini joins Paxos, which recently introduced a USD-backed stablecoin. Same with the Gemini dollar, the blockchain startup’s Paxos Standard has received an approval from the NYDFS; hence, it will undergo the same regulation through the body.