The regulatory authorities from the United States have continued pressurizing the crypto industry ever since its inception. However, their aggression has gone off the charts since the start of 2023.
The regulatory authorities have started to launch scrutiny against the major crypto firms and the way they operate.
They have kept scrutinizing the crypto firms and now, their scrutiny is growing even more aggressive.
The crypto communities have become very concerned about the fact that the regulators have started scrutinizing the stablecoins and their issuers.
The regulatory authorities have been pressurizing the stablecoin issuers that are issuing the tokens pegged with the US dollar.
Communities are Coming Up with Propositions
As the crypto communities are facing constant backlash from the regulators, they have started to come up with their own solutions and propositions.
Most of the propositions they are making move the stablecoins further away from the US dollar. This way, the stablecoins can gain independence from the dollar peg, solving the problem for good.
As more and more propositions are coming in from the crypto community, Arthur Hayes has also given his fair share of ideas in the form of a new proposition.
The former CEO and co-founder of a popular cryptocurrency exchange, BitMEX have made an announcement that is pertaining to a new stablecoin.
Hayes has proposed the launch of a new kind of stablecoin that will not be pegged with the dollar directly. Instead, the new stablecoin will be pegged with Bitcoin (BTC).
He has proposed that the particular stablecoin will be pegged with $1 worth of Bitcoin. It would be a sum between that and Bitcoin’s one inverse perpetual swap that is against the USD.
The details Hayes has outlined give somewhat of an idea about the potential launch of the NakaDollar (NUSD), or the Nakamoto Dollar (NUSD).
Hayes reportedly posted his idea about the potential launch of the token through a blog post. He reportedly names the article “Dust on Crust”. It was on March 8 when the article was posted by Hayes.
Main Idea Behind NUSD
While talking about the NUSD, Hayes said that it has become extremely important for the cryptocurrency industry to move away from the US-pegged stablecoins.
As the regulators from the US are growing concerned about the future of cryptocurrencies, they are going after the stablecoins.
Despite the worldwide adoption of cryptocurrencies in the digital financial sectors, they are yet to find a strong footing in the mainstream industry.
Crypto prominence would hit prominence once they hit the payment terminals at every merchant and retailer in the United States and around the world.
Until that happens, the worldwide expansion of the crypto industry would remain far from absolution. In the meanwhile, the most sensible bridge between the crypto world and the mainstream industry is formed by stablecoins.
The US regulators are very well aware of that and this is the reason why they are hitting the hammer where it hurts the most. They are going after the US-pegged stablecoins so they can disconnect the crypto world from the real world.
While pitching the above, he proposed the idea of launching a stablecoin that is independent and not linked with the dollar at all.
This way, the regulators will not be able to find a way to go after the stablecoins as it is not pegged with their sovereign currency.
How is Bitcoin Going to Back the Stablecoin?
Hayes has proposed that the particular token will be pegged with BTC and these will be the short positions of the asset. Additionally, it would be the inverse perpetual swaps that would make up for the 1:1 ratio between the stablecoin and the dollar.
However, the process going behind the formation of the stablecoin will not make it dependent upon Bitcoin.
The transactions that take place once initiated by the users or the requestors would be carried out mathematically. These would take place between the DAO, the derivate exchanges, and the APs.