Looking Into the History of Stablecoins to Understand the Future of Money

Cryptocurrency was invented and designed to provide numerous benefits for global private and institutional clients, to free people from the burden of banking systems and to create a new financial ecosystem.

The underlying technology, blockchain, can indeed be considered one of the most significant technological advancements of the 21st century, as it provided the groundwork to establish a new kind of money: digital currency. However, after a few years of overhyped crypto market mayhem, countless fraudulent projects and questionable vectors of development, it became evident: global acceptance could not be achieved yet. The industry lacked something vital. Reality had proved that unbacked digital currencies couldn’t lead to a better era. From the ashes of failed investors’ expectations a new cryptocurrency asset class has been born: the stablecoin.

A path to digital age money

In redefining the way of economic interactions, we have to realize one thing: changes and inventions are driven not only by wants, but mostly by needs. Money has always been a sort of development thing, facing constant reshaping along with humanity’s technological advancements. Since ancient times, people have tried using different assets to create a unique measure of value, from commodity currencies like gold and silver in 3,000 B.C. to representative currencies such as the gold standard taking hold in the 1700s.

It’s worth mentioning that an extensive rise in production led to search and expansion to new markets and, as a result, to international trade growth. Any national currency pegged to a specific, fixed gold amount became a universal and convenient payment mechanism. The introduction of this approach helped to find an easy solution for merchandise trade balance calculations for each of the world’s countries.

Later, fiat currencies — such as the United States dollar, Japanese yen or euro — issued by national bodies paved the way for the financial system’s further…

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