IBM To Launch Cryptocurrency

IBM To Launch Cryptocurrency

IBM is reportedly teaming up with a fintech start-up to launch a new cryptocurrency that will make institutional transactions easier. The project will be an experiment, and the plan is to create a stablecoin pegged to the greenback.

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  • IBM has been a dedicated supporter of blockchain technology for the past few years, and this project could establish them as industry leaders.

  • A so-called stablecoin is a cryptocurrency that is pegged to a fiat currency or another asset. This makes them less volatile and more attractive to financial institutions.

  • Today, the most well-known stablecoin is Tether (USDT).

According to CNBC, IBM has teamed up with fintech startup Stronghold USD in order to experiment with a brand new cryptocurrency that will be pegged to the US dollar. The new cryptocurrency and the underlying blockchain will be based on the blockchain used for Stellar (XLM).

Early reports indicate that IBM has two plans with the cryptocurrency. First and foremost, they want to create new opportunities for financial firms and institutions to transfer money quickly with fewer fees. The second plan is to help to stabilize the entire market by introducing a less volatile crypto asset.

Is Institutional Money Being Pumped Into the Market?

Over the past couple of months, there has been a lot of talk that “institutional money” will save the failing cryptocurrency market. The idea is that 2017 was the year private investors controlled the market and that 2018 will be the year where major financial firms will control it.

So far, all of this is only speculation, but during the last few weeks, there have been some developments that could be the first signs of institutional investments. For example, Nasdaq has been discussing the possibilities of entering the market, the other day Blackrock announced that they are looking into offering Bitcoin as EFT, American Express recently applied for a blockchain patent, and now IBM has started developing their own asset.

The future of cryptocurrencies is still unclear but at least it seems like the market has found some support lately and we can only hope that these major organizations will be the savior.

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