Hangzhou-backed Blockchain Fund Targets Roll-out of Japanese Yen-pegged Stablecoin

| Updated
by Sofiko Abeslamidze · 3 min read
Hangzhou-backed Blockchain Fund Targets Roll-out of Japanese Yen-pegged Stablecoin
Photo: Japanexperterna.se / Flickr

The prominent future behind the blockchain technology has encourage the government of the Chinese city of Hangzhou to finance a yen-backed stablecoin project.

When it comes to a cryptocurrency the first things arising in mind are major price swings and high investment risk caused by an overall uncertainty that reigns at the market. Actually the reason for such a drastic volatility is quite obviously: unlike the fiat currencies, which prices are backed by real physical assets, the market value of most digital coins remains a secret for everyone except limited amount of people somehow familiar with the coin background.

Therefore to eliminate or at least to decrease the level of price fluctuations, the coins need a so-called collateral that will pin up their value. It is what stablecoins are about. Stablecoin represents a cryptocurrency pegged to a stable off-chain asset such as gold or hard currencies like the US dollar. Some might say the stablecoins are less decentralized and transparent than the traditional cryptocurrencies, yet there are crypto-collateralized stablecoins anchored to another cryptocurrency, but still more reliable.

It is no wonder that recently stablecoins have gained so much popularity. Yao Yongjie, one of the founding partners of the Grandshores Blockchain Fund based in Japan, announced the fundraising project that pursues a goal of HK$100 million ($12.7 million) to launch the fist Yen-pegged stablecoin by the end of this year or early 2019.

Grandshores Technology Group, a Hong Kong-listed real estate company, has changed its name from SHIS and shifted its focus to blockchain following its acquisition in May by a company run by Yongjie Yao. The latter is also a founding partner of the Hangzhou Grandshores Fund, which has backing from the government of China’s Hangzhou city.

Yao, who serves as chairman of Grandshores Technology, stated that the company would attract qualified investors outside China to raise USDT-denominated funds. USDT is a US dollar-backed stablecoin launched by crypto company Tether.

So far many cryptocurrency exchanges are trading Bitcoin and other cryptocurrencies such as Ethereum and EOS against Tether, the yen-pegged stablecoin is said to become a decent alternative that can be traded on these exchanges.

Yao also revealed that Grandshores was keen to invest in startups and crypto projects across the world as they might revolutionize the financial system and challenge the current monopolies. During a lecture given at Zhejiang University in Hangzhou, Yao shared his vision on the blockchains, saying:

“Blockchain will become the mainstream technology in the next three to five years. We are entering the next stage of blockchain evolution, a stage which is akin to when computer operating system was transiting from MS-DOS [disk operating system] to MS-Windows.”

For the yen-pegged stablecoin project, Yao said that the founding partners of the Hangzhou Grandshores fund have joined efforts with a mid-tier Japanese bank in creating a stablecoin, while the name of financial institution remains undisclosed.

Yao predicts a sheer demand for a forthcoming yen-linked stablecoin and the next anchor currencies Grandshores will explore are the Hong Kong dollar and Australian dollar.

Altcoin News, Cryptocurrency news, Editor's Choice, News
Sofiko Abeslamidze

Sofiko is a freelance fintech copywriter at Coinspeaker. With a Bachelor degree in International Business and Economics, Sofiko has been deepening her knowledge of an agile innovative industry primary focusing on the robust blockchain technology and cryptocurrencies. As a bank employee, Sofiko particularly keens on crypto and blockchain integration into the established banking systems.

Related Articles