By
Steve Muchoki
May 8th, 2024
Armstrong pointed out protocols like Truflation, Ampleforth/Spot, and Nuon that are building crucial infrastructure for the development of flatcoins in the near future.
The growth of the cryptocurrency market has significantly been spearheaded by top crypto firms like exchanges, and DeFi protocols. Coinbase Global Inc (NASDAQ: COIN) has played a major role in pushing the adoption of Bitcoin and other digital assets to millions of investors around the world, more so in the United States. The cryptocurrency exchange has also been pushing for regular clarity in the United States to match with other global markets like Europe, Singapore, UAE, UK, and Canada.
In a bid to enable mainstream adoption of digital assets, Coinbase has developed or invested in crypto startups that are disruptive to highly traditional financial systems and the existing DeFi market. For instance, Coinbase recently launched its Ethereum-based layer two scaling solution dubbed Base. Notably, Base is meant to introduce faster, more secure, and cheaper payments without launching a native coin like most traditional L2s.
Why Coinbase Sees Flatcoins as Next Disruptive Innovation of Money
Coinbase co-founder and Chief Executive Officer (CEO) Brian Armstrong has severally talked about flatcoins as the next form of innovation on money. In a recent interview with Brian Sozzi, the finance executive editor at Yahoo, Armstrong talked about flatcoins as the next iteration of stablecoins that are pegged to real-world purchasing power data like the United States Consumer Price Index (CPI).
“… it’s a new thing on the horizon. There are a couple of teams working on it. We’re not building something in that realm yet, but we’re interested in it,” Armstrong told the media.
Notably, Coinbase CEO described flatcoins as a better form of money that is enabled by the cryptocurrency industry.
“… It would probably be totally decentralized (censorshi-resistant) and track consumer prices (e.g., CPI in the US) to preserve purchasing power, or something close to it. It may need to be backed by a basket of assets to track CPI, or use an algorithmic approach,” Armstrong noted in a recent blog post.
Armstrong pointed out protocols like Truflation, Ampleforth/Spot, and Nuon that are building crucial infrastructure for the development of flatcoins in the near future. Moreover, Armstrong highlighted that the crypto exchange is currently not building anything in this realm but is largely interested in flatcoins.
The stablecoins market has grown exponentially in the past few years especially fueled by high inflation in most countries. Notably, stablecoins pegged to the United States dollar have experienced mainstream adoption, especially in countries struggling with hyperinflation. However, the stablecoins market is also exposed to high inflation as most central banks struggle to bring it down. As a result, Flatcoins have been described as the next frontier to help fight inflation.