Mongolia’s Capital, Ulaanbaatar, will be using a stable coin for instant money transfers and lending services.
Trialing Stable Coin
The Ulaanbaatar’s administration has partnered with a South Korean blockchain firm that issues the stable coin, Terra. The city’s administration hopes to use the stable coin for payments such as utility bills and government subsidies.
The program is in its development phase, with estimated trial launching in the next six months. Initially, the pilot phase will be confined in the Nalaikh district of the city, with extensions to cover the whole eventually. The Terra stable coin will be used for both mobile based payments and peer to peer ones.
Mongolia, a country bordering China, is also making progress towards adopting blockchain for different purposes. Last year, the country’s central bank granted license to its biggest mobile telecom operator to issues its own cryptocurrency.
Terra is a stable coin that was launched by Daniel Shin, the founder of Ticket Monster, an e-marketplace in South Korea. The project was able to raise nearly USD 32 million from its funding round in August 2018. The stable coin has made several high profile partnerships, including messaging app giant KakaoTalk and other blockchain organizations such as Huobi Capital, OKEx and Binance Labs.
Stable coins, unlike other cryptocurrencies, are bound to a physical asset’s value. This eliminates the sharp value variations cryptocurrencies normally are subject to. The stability in value allows for day to day usage and transaction without the worry of price jumps and erosions. The most famous stable coins, the USDT, is such an example (where it is tied down to the value of the U.S. Dollar).
Social media giant Facebook is also working on its own stable coin, to be used for remittances through its messaging app.