Binance platform joins a number of major platforms to create a stable digital currency

Binance platform joins a number of major platforms to create a stable digital currency

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Answer Binance platform joins a number of major platforms to create a stable digital currency

Binance, the largest cryptocurrency exchange, announced that it has joined three other major platforms to fund Terra, a new initiative aimed at people adopting digital money using the so-called stablecoin.

To create this idea, Project Terra raised $32 million from various investment funds and cryptocurrency exchanges such as OKEx, Huobi, and cryptocurrency-focused operator Upbit, including Polychain Capital. Binance also contributed through its investment division, Binance Labs, and its own independent investment fund.

The idea of ​​a stable digital currency (Stable Coin), as its name indicates, is a currency that is not affected by price fluctuations, whether it is the effect of the price of Bitcoin or any other digital currency.

Read:The Financial Regulatory Authority (FCA) gives UK crypto firms a set time to meet legal regulations

Although there are a number of stablecoins in the market, Project Terra has a competitive advantage which is its partnership with a number of online stores in Asia to encourage individuals to use the coin.

Note that one of the founders of the Terra project, Dania Shin, runs an online store in South Korea. In a previous interview, he explained that e-commerce is very prevalent in Asia and that their partnership with well-known brands will convince consumers to try Terra through well-known applications such as WeChat.

The e-commerce adoption strategy will include providing discounts and rewards to everyone who uses Terra coin. At the same time, brands will have an incentive to support Project Terra as it will allow them to lower transaction fees that banks and financial institutions accept today.

Perhaps the biggest challenge for the Terra project, as with other stablecoins, is to convince people that a stablecoin has a fixed value and will always be linked to the main currency.

It is worth noting that the digital dollar (Tether) is the most popular stablecoin today, and the value of each unit is one US dollar, but some still question whether the currency is actually supported against the US dollar.

Read:The Risks of Leveraged Trading: The Story of a Trader Who Lost All His Bitcoin

According to Shen, Project Terra plans to raise a total of $100 million and use 90% of that amount as a reserve to support the currency.

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