Bitcoin-Based Stablecoin Expected to Emerge in 2024, CoinShares Predicts
Summary:
Investment firm CoinShares anticipates the launch of a Bitcoin-based stablecoin in 2024 that could compete with existing stablecoins in speed and cost. The firm's head of Bitcoin research, Christopher Bendiksen, and analyst Matthew Kimmel suggest that a successful launch could strengthen Bitcoin’s monetary properties and its ability to resist censorship. However, they also recognize existing technical barriers and user tendencies towards cheaper and faster networks. A firm known as bitSmiley Labs, supported by cryptocurrency exchange OKX's venture capital arm, is reportedly preparing to launch a Bitcoin blockchain-based stablecoin called bitUSD.
The investment company CoinShares suggests that a Bitcoin-founded stablecoin will likely hit the crypto scene this year, potentially competing with the velocity and cost of its current industry counterparts. CoinShares analysts forecast 2024 to be a game changer for Bitcoin moving into the stablecoin space, according to their most recent projection report dated January 22. They further anticipate the unveiling of a Bitcoin project aimed at vying for a position in the modern stablecoin market, readily accessible to users. CoinShares' Chief Bitcoin Research Officer, Christopher Bendiksen, and analyst Matthew Kimmel, believe theoretically viable development projects might soon see the light of day, offering accessibility to new tools. They hypothesized that a Bitcoin stablecoin venture might intensely contest with others in terms of speed and cost, while concurrently benefiting from Bitcoin's core stability.
Bendiksen and Kimmel further highlighted the strengths of Bitcoin, including its long history, stability, minimal technical debt, and robust assurances, all making it a competent contender for stablecoin foundations. They suggested that the emergence of such a project could bolster Bitcoin's monetary attributes and fortify its capacity to withstand censorship. They acknowledged, however, that there are still technological hurdles to overcome, recalling historical tendencies for stablecoin users to opt for faster, cheaper networks. Existing Bitcoin-based stablecoins could soon be replaced by more user-friendly ones, they postulated, predicting further integration of stablecoin transactions into businesses and Bitcoin plugins to facilitate consistent usage growth.
Several companies, including Stacks, RSK, and Liquid Network, which leverage Bitcoin infrastructure, have already rolled out stablecoins built on Bitcoin's foundational layer, cited Trust Machines. It added that while these stablecoins are operating on Bitcoin's layer 2 network, a transition to Bitcoin's core layer may not be too far off, although currently deemed impractical. An imminent launch of a Bitcoin blockchain-based stablecoin, dubbed "bitRC20," has been announced by bitSmiley Labs, a firm bankrolled by cryptocurrency exchange OKX's venture capital sector.
As per bitSmiley Labs' latest white paper, a forthcoming new stablecoin, bitUSD, is set to have its circulation fully collateral-backed, with all transactions transparent on the Bitcoin blockchain. The white paper revealed that bitUSD's value will be 'softly pegged' to the US dollar.
Published At
1/23/2024 7:09:18 AM
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