- Smart contract network RSK has its first stablecoin, courtesy of Money on Chain project.
- Just as RSK’s network is anchored to Bitcoin’s proof-of-work blockchain, the new Dollar on Chain (DOC) stablecoin issued by Money on Chain is bitcoin-backed.
Smart contract network RSK has its first stablecoin, courtesy of Money on Chain project. Just as RSK’s network is anchored to Bitcoin’s proof-of-work blockchain, the new Dollar on Chain (DOC) stablecoin issued by Money on Chain is bitcoin-backed. Like MakerDAO’s DAI, DOC is collateralized, in this case by BTC which enables the token to retain its dollar peg without incurring counterparty risk for traders.
Money on Chain has accompanied its maiden stablecoin with a secondary token, BitPRO (BPRO), which enables BTC holders to earn a passive income. BPRO bears some similarities with MakerDAO’s MKR token, in this case providing holders with a percentage of fees and interest collected on the platform for locking up their BTC.
"Creating representations of local currencies with Bitcoin backing was the first use case we envisioned when we developed RSK,” said Diego Gutiérrez Zaldívar, CEO of IOV Labs, the parent company of RSK. “This is a very important step towards a more open and transparent financial system,” added Money on Chain CEO Max Cajurzaa. “The Money on Chain protocol enables other projects to develop lending, credit, and advanced trading for Bitcoin holders.”
A Tsunami of Stablecoins
The cryptoconomy’s stable of digital assets is now running over with stablecoins, which have proliferated over the last 18 months. While none of the new contenders has been able to lay a glove on Tether (USDT), whose market share has actually increased, a handful have carved out a niche for themselves. After a promising start, the Gemini dollar’s market cap has withered away to virtually nothing as demand has died, but Circle’s USDC, backed by major players such as Coinbase, is faring better in terms of fiat-backed stablecoins.
The launch of Dollar on Chain (DOC) on RSK’s network is a coup for the IOV Labs smart contracting platform, which has been striving to position itself as a viable ecosystem for decentralized finance projects. At the moment, the bulk of the defi movement revolves around Ethereum, where MakerDAO’s DAI and SAI stablecoins hold sway. DAI is Maker’s take on a multi-collateralized stablecoin, but for now the asset only takes its weighting from ETH and a handful of other ERC20s such as Brave’s BAT. With its lower volatility, greater liquidity, and higher number of holders compared to ETH, BTC is better positioned to serve as stablecoin collateral.
What’s up DOC?
All eyes will be on Money on Chain’s DOC to see whether the newly launched stablecoin can maintain its peg and gain adoption. Should it succeed in this respect, bitcoiners may be enticed to lock up their BTC and earn a return on their assets through the complementary BitPRO token. Securing native stablecoins that operate on its network are crucial to RSK building out its vision of a decentralized finance system revolving around Bitcoin. With IOV Labs having recently acquired 30 million-strong social network Taringa, with the goal of introducing defi products, the DOC stablecoin will move RSK a step closer to realizing its goal of onboarding web users to the world of crypto assets.