US billionaire investors Cameron and Tyler Winklevoss have issued a stablecoin linked to the US dollar that is regulated by the New York authorities, Cameron Winklevoss said in the official Gemini exchange blog on Monday. Dubbed Gemini Dollar (GUSD), the new cryptocurrency is built on Ethereum’s ERC20 standard and aims to make a bridge between the crypto world and traditional financial sectors.
Gemini Trust Company, the owner of the Winklevoss’ cryptocurrency exchange, is the issuer of GUSD.
The coin was released at 14:00 UTC on Monday. Gemini Dollar has all the necessary approvals from the New York Department of Financial Services (NYDFS), Winklevoss claimed.
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Gemini exchange will allow its customers to convert their US dollar into GUSD and to withdraw them from a specified Ethereum address.
The dollars that backs the new coin will be held in a US bank, that has the Federal Deposit Insurance Corporation (FDIC) pass.
“The U.S dollars that correspond to the Gemini dollars issued and in circulation will be held at a bank located in the United States and eligible for FDIC “pass-through” deposit insurance, subject to applicable limitations.
In addition, the U.S dollar deposit balance will be examined monthly by an independent registered public accounting firm to verify the 1:1 peg,” Cameron Winklevoss outlined in the blog.
The Street Bank is the financial institution, which will deposit the GUSD’s fiat dollars, Tyler Winklevoss told CNBC, but the bank declined to comment on the news.
Winklevoss twins have entered the stablecoin market, which consists of coins-pegged to the value of a strong asset in a bid to resolve the volatility problems of the cryptocurrency.
Tether (USDT) is the largest player by market capitalization with competitors like bitUSD (BITUSD), bitEUR (BITEUR), TrueUSD (TUSD), and NuBits (USNBT).
“While cryptocurrencies operate 24/7/365 (similar to email), fiat currencies only operate during specific “business hours” (like snail mail) - a fundamental mismatch… we must improve the linkage between these worlds by giving fiat currency the same desirable technological qualities of cryptocurrencies,” Cameron Winklevoss wrote.
Winklevoss brothers are among the leading players in the cryptocurrency market.
They own the Gemini virtual coin exchange and made several attempts to take regulatory approval for their Bitcoin (BTC)-related exchange-traded fund (ETF), which have been rejected by the US Securities and Exchange Commission (SEC).