Origin Adds TrueUSD Stablecoin
The Ethereum powered, sharing economy platform Origin is adding another stablecoin: TrueUSD.
The news comes in the form of a blog post, explaining the need for a stablecoin in their peer-to-peer economy.
“[T]here are solvable problems standing between us and a future of truly peer-to-peer commerce. One of these problems, cryptocurrency price volatility, has a significant negative effect on listings on the Origin DApp, but we are optimistic that stablecoins will mitigate a lot of the risk inherent to these transactions.”
Created by TrustToken, TrueUSD is the second most popular stablecoin by volume, trailing only TetherUSD. Tether has had some issues of late, recently losing its peg. It regained its peg to the dollar a few days later but the experience, along with rumors of financial problems, have scared off some companies and investors. Tether continues to address those issues but some people remain unconvinced.
Origin is a platform designed to cut out the middlemen in the sharing economy. Companies like Lyft, Fiver and AirBnB often take up to 30% of the entire sale in fees. Origin thinks their services can be fulfilled for much cheaper using the blockchain. They aren’t actually offering those services themselves, but are building the platform so other companies can while competing with their centralized counterparts thanks to much lower fees.
TrueUSD isn’t the only stablecoin set to be supported by Origin. They have said they intend to support every ERC20 stablecoin and have already announced support for Circle and Coinbase’s USDCoin.
Obviously, the volatility of cryptocurrencies make it difficult to offer services using those coins. The purchasing experience of any item can often be a difficult one. The cause is in the variances in exchange rates among payment processors, blockchain delays and other issues. Even with a unified platform, the change in price can make storing a lot of Bitcoin or Ethereum on an dapp a dangerous one. You could load up $50 worth of cryptocurrencies, planning to provide you with rideshares the entire weekend, only to find out you have significantly less than that because the price tanked.
By using stablecoins, users won’t have to worry about that issue. And by offering more than one stablecoin, the risks of a single coin’s failure is lessened. Origin sees this as essential to their goal of creating a truly decentralized sharing economy. When they announced the addition of USDCoin, they explained why stablecoins are essential to their business model.
“[F]or marketplaces that facilitate the purchase of a service that may not be rendered until much later in the future, price volatility of the payment currency will inevitably create a scenario in which one party — either the buyer or the seller — is going to see a significant gain while the other will see a loss of the same amount. For example, if I booked a house rental in January 2018 for my Hawaii vacation in October and paid in bitcoin, I will have paid more than double what I could have if I had paid in US dollars.”
Origin is expected to leave its Beta period later this year.