- Features of the new USDS stablecoin
- Who can earn rewards for participating in the network?
- USDS token minting and burning process
BitGo, a cryptocurrency custodian, announced the launch of a new stablecoin pegged to the US dollar called USDS. The new asset aims to reward network participants for providing liquidity.
Features of the new USDS stablecoin
The new USDS stablecoin, scheduled for launch in January 2025, is backed by a combination of short-duration Treasury Bills, overnight repos, and cash. It is designed to challenge major stablecoins like Tether (USDT) and Circle’s USDC (USDC). The stablecoin is issued by BitGo New York Trust Company, a regulated trust company formed in 2021 under the laws of the State of New York.
Who can earn rewards for participating in the network?
According to the official USDS website, BitGo plans to distribute rewards to participants who generate sufficient liquidity and register with BitGo. Once registered and approved, participants must prove ownership of the addresses where they store USDS via the USDS portal. These addresses will be used to compute daily balances and ensure fair calculation of rewards to participants. The reward system will include different compensation tiers based on the amount of USDS under custody with each participant.
USDS token minting and burning process
BitGo aims to make the minting and burning of tokens accessible to a broader range of qualified users. Once approved, users can mint USDS using USD, USDC, or USDT. Similarly, users can burn USDS and receive USD, USDC, or USDT. BitGo will cover any associated fees. BitGo emphasizes that it does not compete with other market participants as an exchange but strives to incentivize the growth and adoption of the entire ecosystem.
The launch of BitGo's USDS stablecoin suggests significant changes in the stablecoin ecosystem. With its unique reward system, the new asset could attract many participants and stimulate ecosystem development.
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