Cryptocurrency exchange platform, Gemini, founded by Cameron and Tyler Winklevoss has announced on Monday the launch of its digital token, Gemini U.S dollar (GUSD).
The Gemini exchange was founded by the Winklevoss twins in 2014, with the aim of building a bridge between fiat currencies through cryptocurrencies like BTC and ETH. It has now increased its offering by launching its own token.
The newly launched token is an ERC-20 token based on the Ethereum blockchain. It was developed to facilitate the process of sending and receiving of US dollars regardless of the location of transactions.
According to the GUSD whitepaper, the token will combine the creditworthiness and price stability of the US dollar through blockchain technology.
The company is hoping to proffer solutions to the problems Tether token had in June when a law firm accused the token of not being fully backed by the US dollar after investigations showed the token had excess US dollar in its Puerto Rican bank accounts.
“To date, there has been no trusted and regulated digital representation of the U.S. dollar that moves in an open, decentralized manner like cryptocurrencies,” Gemini wrote in the statement.
Obtaining GUSD Token
The GUSD whitepaper stated that users of the Gemini exchange platform could purchase the token. To acquire the token, users must first deposit a certain amount of US Dollar into their Gemini account and then exchange it for the digital currency.
Also, users can exchange the token within the platform. The Winklevoss twins seem so confident about the newly launched GUSD, claiming that within a short period, the token will be available on other global exchanges
Legitimacy of GUSD
Part of the release stated that the token had gotten the needed license for operation from the New York Department of Financial service (NYDFS).
Gemini has promised to safeguard its holdings that will back the virtual currency in a US-based State Street Bank, to avoid a scenario that occurred with Tether token in June. Gemini also promised to audit its holdings on a monthly, and release reports to the public.
Will the newly created Gemini stablecoin really solve Tether’s problem?