On Monday, Sept. 10, New York State announced its approval of two new cryptocurrencies tied to the U.S. dollar.
These “stablecoins” (cryptocurrencies with values tied to relatively stable assets such as the dollar) are being offered by Paxos Trust Company and Gemini Trust Company. Their coins will be called the “Paxos Standard” and the “Gemini Dollar,” respectively.
Because they are equal in value to the U.S. dollar, the Paxos Standard and Gemini Dollar will provide more stability than other cryptocurrencies and liquidity for cryptocurrency trading. By taking its value from the dollar, stablecoins, unlike other cryptocurrencies, are tradable outside of business hours.
Gemini is controlled by twins Cameron and Tyler Winklevoss, who have been heavily invested in cryptocurrencies since they netted $65 million suing Facebook’s Mark Zuckerberg. New York’s approval of the Gemini Dollar comes on the heels of the Securities and Exchange Commission’s rejection of the Winklevoss’ bitcoin-packaged exchange-traded fund earlier this summer.
The Paxos Standard and Gemini Dollar may bring some stability and confidence to the crypto market. In a recent article, Tech Crunch called stablecoin “an important step forward in cryptocurrency acceptance.”
Paxos and Gemini were not the first attempts at tying cryptocurrencies to the dollar. One such coin, called Tether, was the subject of ridicule in the crypto community. However, New York’s approval is a positive sign for the concept.
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