London Block Exchange (LBX), a UK-based cryptocurrency exchange, has unveiled its intention to release a new virtual currency pegged to the pound, called LBXPeg.
The company said that they will initially use Ethereum’s blockchain for the development and distribution of the stablecoin. Allegedly, the LBX has received permission from an unnamed banking partner to roll out LBXPeg, which will be tied to GBP.
When can we expect the first LBXPeg?
According to Benjamin Dives, who is the CEO of LBX, the first LBXPeg should be minted in the next 10 days. Currently, the LBX allows for direct fiat trading for various cryptocurrencies, such as Bitcoin, Ethereum, Litecoin and Ripple, via a desktop and mobile interface.
“The primary use case will be settlement for OTC trades in the London market, then commonwelth exchanges where they don’t have fiat banking, and then securities tokens who want to pay dividends in a cryptopound,” said Benjamin Dives, CEO of LBX.
According to the company blog, LBXPeg is necessary because the existing stablecoins are inadequate, due to their opaque management structures, distribution schedules and auditing processes.
Popularity of stablecoins
Stablecoins have become extremely popular, due to worries about the volatility of strictly digital cryptocurrencies. The most recognizable stablecoin is Tether, which claims to be backed by the US dollar. Tether comprises 93% of the all stablecoin market value. Other popular stablecoins include Dai (a stablecoin option from the team behind the MakerDAO project), TrueUSD (pegged against the US Dollar), Haven Protocol, and BitUSD (also linked to the US Dollar).
Stablecoins are currently flourishing in the US, so a new stablecoin from the UK would make the competition more diverse.
Cryptos and pound sterling
Established in November last year, LBX offers an application through which customers can buy and sell various cryptocurrencies with the pound sterling.
In May 2018, the company added Bitcoin Cash and Ethereum Classic to its list of cryptocurrencies. At the time, it was the only exchange in the country to offer these 2 crytocurrencies against the pound. Afterwards, the company added other not so popular cryptocurrencies to its platform. This raised the total number to 11.