The London Block Exchange has announced the launch of a GBP-pegged cryptocurrency stablecoin called LBXPeg. In a statement posted on its website, LBX revealed that the so-called “cryptopound” will be tied to the value of GBP held in an auditable U.K. bank account on a 1:1 basis.
“We will be ready for the first cryptopound to be minted in the next 10 days. The primary use case will be settlement for OTC trades in the London market, then commonwealth exchanges where they don’t have fiat banking, and then securities tokens who want to pay dividends in a cryptopound.”
Since opening in Nov. 2017, LBX has become one of the UK’s busiest crypto exchanges, and, like many other exchanges, it sees a significant value in the stablecoin concept. Taking the concept from a fresh angle designed to appeal to U.K.-based crypto traders, LBXPeg promises its users fully transparent auditing processes, management structure and distribution schedules, all of which have been major complaints about the stablecoin market lodestar tether (USDT).
According to LBX, the new “cryptopound” will enable seamless and fast transfer of GBP digital equivalent on a worldwide scale. In addition to just being a stablecoin, it also comes with built-in use cases such as company dividend distribution to shareholders via smart contracts using the Ethereum blockchain.
LBXPeg will initially run on Ethereum’s ERC-621 standard, which is an extension of the popular ERC-20 standard. The company says that this will provide the necessary flexibility in total supply to match the GBP holdings kept in the segregated bank account. Eventually, the plan is to LBXPeg to be issued on other blockchains subject to compliance audits.
The company further revealed that following LBXPeg’s initial release, it will explore tying the stablecoin to other auditable accounts containing fiat currencies like EUR and USD, so as to improve the product’s scope and stability.
Of late, USDT has faced a growing number of challenges to its stablecoin market dominance. CCN reported recently that Goldman Sachs-backed Circle Financial announced the issue of USD Coin (USDC), a dollar-pegged stablecoin that took aim at tether’s perceived opacity and lack of accountability. Gemini, the cryptocurrency exchange owned by Cameron and Tyler Winklevoss, also recently announced the launch of the Gemini Dollar, which was billed as the world’s first fully-regulated stablecoin, operating under the oversight of the New York Department of Financial Services (NYDFS).