TL;DR
- Agora has launched its new stablecoin AUSD, designed to be more robust and adaptable to the current market needs.
- Nick van Eck criticizes yield-bearing stablecoins, arguing that they do not provide the stability or utility needed in the crypto market.
- AUSD will be launched on the Ethereum mainnet in June, aiming to strengthen the crypto industry with greater stability and security.
Agora, a renowned blockchain company, has announced the launch of its new stablecoin, AUSD, with the intention of revolutionizing the stablecoin market. Nick van Eck, the company’s CEO, has shared his vision for the future and introduced AUSD as an innovative solution to the current yield-bearing stablecoins, which he considers problematic.
Van Eck criticized stablecoins that offer passive income, questioning their reputation and asserting that they do not represent real money. From his perspective, these yield-bearing stablecoins deviate from the fundamental mission they were created for, which is to provide stability and ease of use in the crypto market. Additionally, he noted that these cryptocurrencies have serious drawbacks, such as lower utility and acceptance in the market, and limited development potential. These limitations hinder their mass adoption and efficient use across various platforms and services.
“Yield-bearing stablecoins” are not money or stablecoins.
Stablecoins are already a $150 billion market and settle $10T annually. We see them growing to $3T by 2030. “Yield-bearing stablecoins” are not part of this market.
At @AgoraDollar, we believe that digital dollars are…
— Nick van Eck (@Nick_van_Eck) May 27, 2024
The CEO of Agora explained the evolution of asset-backed cryptocurrencies like the dollar from their inception, highlighting the first centralized versions such as USDT, and their development towards what he calls Stablecoin 3.0 with the launch of AUSD. This new model aims to overcome the limitations of previous versions and offer a more robust coin that is adaptable to the current market needs.
One of van Eck’s main concerns is the classification of yield-bearing stablecoins as securities by several jurisdictions, including the United States. This classification restricts their availability and tradability, limiting their ability to reach a wider audience and their integration into various commercial platforms. Additionally, he emphasized that these assets often face liquidity problems, complicating their use as a medium of exchange and store of value.
Agora Will Launch AUSD in June
Agora, on the other hand, has designed AUSD to better meet business needs. Van Eck explained that the model is conceived to compensate businesses based on the services they provide, such as listing the token, providing liquidity, conducting marketing campaigns, and accepting AUSD as a payment method or collateral on their platforms. This incentive structure aims to promote adoption and greater integration into the crypto ecosystem.
The launch of AUSD on the Ethereum mainnet is scheduled for June, and this new stablecoin is expected to strengthen the crypto industry. Agora claims that the adoption of AUSD could provide greater stability and security, which are crucial aspects for the evolution and expansion of the crypto market.
Furthermore, van Eck emphasized that while yield-bearing stablecoins can complement coins like AUSD, USDC, and USDT, they should not be considered substitutes. AUSD aims to set a new standard in the market, providing a reliable and effective option for businesses and individual users
