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New Crypto-to-Fiat Bridge Set to Compete with Stablecoin Market, but There’s More

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Mon, 03/25/2019 - 09:04
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  • ⛓️🚀While stablecoins are taking the cryptocurrency market by the storm, there is a new Blockchain  project that could challenge them

Cover image via U.Today
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Nimiq, a new Blockchain-based project, threatens to disrupt the $2.8 bln stablecoin market after creating a technological blueprint that makes fiat currencies “Blockchain-compatible”. In order to implement its ambitious plans, Nimiq teamed up with WEG Bank AG and Agora.Trade. The general potential of Nimiq OASIS goes far, as by design and following an introduction period, it will be non-exclusive and empower other banks, exchanges and blockchains to tie in and allow decentralization and adoption in ways that reflect the spirit of blockchain technology.  

Bridging the two industries

Nimiq OASIS (Open Asset Swap Interaction Scheme) connects cryptocurrency holders to bank account owners and facilitates the exchange of funds between the two ecosystems. It eliminates the need for middlemen like payment service providers. Thus, one can seamlessly exchange crypto and fiat currencies without the private keys of the crypto asset ever leaving the owner’s possession or having a centralized intermediary controlling the two assets being exchanged. No matter how reliable a certain payment service is, there are always security bottlenecks, and relying on third-party companies always incurs security concerns.

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Is it better than Simplex?  

As reported earlier by U.Today, Binance, the leading cryptocurrency exchange by trading volume, teamed up with Israel-based startup Simplex to roll out credit card payments for Bitcoin (BTC), Ethereum (ETH), XRP (XRP), and Litecoin (LTC).

While that was a highly-anticipated feature, it turned out to be quite pricey for some exchange users. Payment processors in the likes of Simplex require you to pay a hefty 5 percent fee.

Stablecoin market disruption

Stablecoins became one of the most pervasive crypto trends of 2018. These fiat-backed currencies allowed a means of hedging against the highly volatile cryptocurrencies. Tether (USDT), despite plenty of controversies, remains among the top 10 biggest coins by market capitalization. USD Coin (USDC) and Gemini Dollar (GUSD) are yet another two contenders to occupy a sizeable chunk of the crypto market. Even JPMorgan, the number one bank in the US, recently made a foray into crypto by introducing their own dollar-pegged stablecoin.

Tapping into the OTC market   

The lion’s share of cryptocurrency trading is happening behind the scenes in the over-the-counter (OTC) market. While institutional investors continue flocking to the OTC market, there is still no robust infrastructure, with some dealers even resort to setting up trades over Skype and Telegram. Nimiq OASIS  could provide a viable alternative for OTC trading.

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Revolutionizing the buying & selling of crypto

By bridging crypto and the banking industry, Nimiq OASIS could potentially enable wider cryptocurrency adoption by offering an easier and more convenient way for people to get money in and out of cryptocurrency markets. Nimiq could challenge the current industry leaders, such as Richard Branson-backed custodial processor BitPay, by connecting banks directly with decentralized cryptocurrency exchanges like Agora.Trade and offering merchant integration. This could make it both easier and cheaper for merchants to accept cryptocurrency payments.

WEG Bank AG CEO Matthias von Hauff claims that Nimiq has the potential to revolutionize the way we deal with cryptocurrencies. Meanwhile, Agora.Trade co-founder Reto Trinkler believes that the project could help the industry to go back to ‘what Blockchain is all about’.

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.

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