It was recorded that Nigeria had the 5th highest number of bitcoin transactions in the world. A stablecoin that is naira-backed would give Nigerian and African traders a hedge because the naira transactions are susceptible to challenges like maintenance fees, transaction charges, and a number of other costs.
Africa’s first stable coin, the $abcd was founded by a trust company. A stable coin is a non-volatile coin unlike other crypto assets. For instance, bitcoin is volatile because the price is not stable and fluctuates substantially. A stablecoin, as the name implies, is stable. This stable coin is backed by Naira as they are usually backed by a fiat currency. Similar to how the USDT is backed by the United States dollar, the $abcd is backed by the naira. It was recorded that Nigeria had the 5th highest number of bitcoin transactions in the world. A stablecoin that is naira-backed would give Nigerian and African traders a hedge because the naira transactions are susceptible to challenges like maintenance fees, transaction charges, and a number of other costs. The coin was pegged 1:1, that is 1 $abcd coin equals 1 naira. Africa’s first stablecoin was naira-backed because Nigeria is Africa’s largest economy and has the largest population of all countries in Africa.
$abcd will reduce the price volatility in trading and interacting with cryptocurrencies in a country like Nigeria thereby increasing the flexibility in the usage of this coin. Also, it will reduce the restrictions and control that financial institutions have. A number of service charges are imposed by banks, among them are ATM fees. The ABCD network would provide a better medium of exchange as it would be a very good alternative to naira fiat and it would help users to send them to each other. The co-founders of the coin are Bit Sika and Linova capital. Linova capital would be responsible for the issuance and the redemption of the coin. The token is supported by over 9 exchanges in the ecosystem and it would be audited by a certified independent public accountant. They review the number of the tokens in circulation on a monthly basis.
$abcd tokens can be acquired on the Bit Sika exchange and other partner exchanges. The tokens are burnt and created based on demand and supply preventing its price from fluctuating in too large of a delta. $abcd is credited to the holder’s account as soon as the holder deposits on the Bit Sika exchange and meanwhile naira fiat is debited from the Bit Sika account. These tokens are liquidated or destroyed at the time of deposit into the Bit Sika exchange. The token is redeemed to naira from the exchange at the time of withdrawal. Excess tokens are burnt and the corresponding reserve backing is freed.
Individuals, merchants, and exchanges are the primary beneficiaries of $abcd token. They’ll enjoy the non-volatility of the token in their transactions and it will enable them to browse and navigate the crypto economy where volatility leads to unstable value of the assets they hold. Exchanges can sometimes have a difficult time trying to make fiat deposits and withdrawals within the current financial centralized structure. That system is slow, risky, expensive, complicated, and complex which unfortunately contributes to unreliable service and lacks proper security standards. $abcd will provide a stable storage to exchanges so their users can make deposits and withdrawals in a safer way and at very little to no cost.
It would also provide different trading pairs with the token on Binance’s DEX. Individuals are not left out, either as many people in the crypto space use it in one way or the other. There are traders that work with cryptocurrencies in attempts to earn gains on a daily basis. They also have many holders that store and manage cryptocurrencies among many more reasons. The traders would benefit from the $abcd stablecoin as well as the holders that would enjoy the non-volatility in the value of the coins they may hold.
Lastly, merchants are also one of the beneficiaries of this new stablecoin. It was recorded that 70% of digital transactions failed in 2016 in Nigeria. This token will help merchants make seamless transactions and avoid service charge as well as allow them the capability to process the conversions effortlessly. $abcd will provide a brand new kind of bridge from the legacy financial structure which is centralized to a decentralized system. The token will strictly guard against volatility that is quite evident in the crypto space and thereby help create opportunities that are sure to come about from the decentralized financial system. The token is set to be launched and available by this month, January 2020.
Source: ABCD Whitepaper