Post by anenro on Mar 15, 2021 19:52:36 GMT 4
As a store of value, a medium of exchange, and a unit of account, fiat money achieves monetary utility. However, since the elimination of the gold standard in 1971, fiat money has essentially been free floating in the market without intrinsic value. Instead, it derives value from its status as government-issued legal tender. In short, fiat money has value because governments and central banks say it does.
This dynamic is problematic when the same parties guide monetary policy. Governments or central banks can expand or contract the money supply to achieve target inflation and interest rates. In a growing economy, stable, predictable inflation is acceptable to policymakers, given the marginal impact on purchasing power. However, over the long-term, inflation inherently devalues any fiat currency. At worst, the unchecked printing of money triggers destructive hyperinflation.
The common thread is this: everyday consumers suffer most for the shortcomings of fiat. But what’s the solution? To answer this question, the utility of digital currency must also be part of the discussion.
The arrival of blockchain-enabled cryptocurrency represents the next step in the evolution of money. These digital currencies live on-chain in the absence of a central authority. Instead of rolling off a printing press like fiat currency, cryptocurrency miners “mint” new tokens while competing for block rewards. It works like this: blockchain networks utilize a consensus mechanism, like Proof of Work (PoW), to validate transactions in the absence of a central authority. Miners compete to solve complex mathematical algorithms to validate transactions and add them to the blockchain. The successful miner receives block rewards in the form of cryptocurrency for their efforts.
While mining is responsible for the genesis of new cryptocurrency, secondary markets determine prices. Since emerging over 11 years ago, the cryptocurrency market has proliferated. As of October 2020, the total market value was around $450 billion, with new initiatives seeming to launch weekly. However, cryptocurrency prices remain highly volatile as the market maturation process continues. As such, digital currencies present questionable utility as a store of value or medium of exchange.
Stablecoins, originating from the realm of decentralized finance (DeFi), are built to tackle this shortcoming. These supported digital currencies maintain a 1:1 ratio with fiat currencies like the USD or EUR. However, many of the most popular stablecoins like Tether (USDT) and USD Coin (USDC) are still directly tied to the fiat’s value, in this case, USD. As such, price stability results at the expense of autonomy—a stablecoin backed by fiat still perpetuates harmful monetary policy. Governments and central banks can directly affect the value of these stablecoins by expanding or contracting the supply of fiat, causing inflation — the public has no control over the policies that may devalue their currency. Further, fiat-backed stablecoins hold collateral off-chain, resulting in a concerning lack of transparency.
AXIA Dual Blockchain Design
New solutions are necessary to ensure everyone benefits from the next generation of money. AXIA offers a fresh take on how a global reserve currency can be designed to benefit people beyond national borders. Although AXIA Coin is supported like a commodity-backed stablecoin, the allocation of value functions much differently. The AXIA Dual Blockchain Design highlights how this particular mechanism, and others, interact on the platform to achieve optimal stablecoin-like performance, but within a true open and decentralized marketplace.
The AXIA Coin Network Blockchain
The AXIA Coin Network Blockchain facilitates the transfer of value between participants. Users interact with this network through a decentralized application (DApp) built on a public blockchain network. Like some fiat payment networks, AXIA distinguishes between user groups—individual, business, or charity. The AXIA Transaction Link (ATL) operates as a series of connected smart contracts on the AXIA Coin Network Blockchain, executing transactions in line with predetermined user group rewards and fee schedules. Each of these transactions registers to the AXIA Coin Platform Blockchain for complete transparency.
The AXIA Reserve Blockchain
Every time ATL smart contracts trigger the collection of transaction fees, a specified percentage is allocated to the AXIA Reserve. This automated process results in a predictable flow of value to the platform reserve. The Asset Accumulation Algorithm (AAA) simultaneously deploys these funds to build up reserve holdings and maintain reserve value in any number of real-world assets including real estate, art, or commodities like gold and silver. As the AAA makes purchases, the records become visible in real-time to the public over the AXIA Reserve Blockchain. Those maintaining the security of the AXIA network, also known as nodes, can view every transaction. These nodes also provide real-time, third-party verification and disclosure of the asset-base valuation.
The Future of Money
In contrast to existing fiat and cryptocurrency frameworks, AXIA improves the utility of money by adding a fourth function—the creation of value. In combination with a finite token supply, the accumulation of real-world assets in the AXIA Reserve ensures that AXIA Coin grows more and more resilient. Further, by rewarding network participants based on their user group and enabling greater transparency, AXIA addresses the limitations of existing stablecoins and presents a unique approach to deploying a reserve currency with global scalability.
Whether we think about it or not, when governments print money they create debt and this process actually makes life harder for everyone, especially the poor and working class. As the inflation that is the inevitable result of this printing hits, the cost of goods goes up, while wages have remained relatively stagnant for the working poor. Though inflation is an issue almost everywhere, citizens in countries that have especially weak currencies– like Venezuela, Zimbabwe and South Sudan– have been hit especially hard.
Blockchain-based, supply constrained cryptocurrencies like Bitcoin provide one possible solution to the problem of currency inflation. However, nobody is quite sure how to value Bitcoin because it’s not backed by any real assets. In other words, people purchase and trade Bitcoin only because of its scarcity. As a result of that uncertainty and the speculative nature of freewheeling crypto markets, huge price swings are typical. Other cryptocurrencies like USDT, Reserve and Tether appear more stable because their supply is supposedly linked to a matched backing structure, leaving the digital tokens that exist in in the market linked to a provable supply of fiat money stable, but inflation is still an issue because the price of those coins are tied to fiat currencies. That’s where AXIA comes in. It’s a cryptocurrency project that’s attempting to create a new reserve currency for the world.
The case for a new world reserve currency
Does the world really need a new reserve currency? Some experts are arguing that it does. Moorad Choudhry, the former Head of Business Treasury, Global Banking and Markets at Royal Bank of Scotland, says that the United States economy now constitutes a steadily decreasing share of world economic output. If that trend continues, international monetary authorities may start looking for an alternative store of value.
The U.S. Dollar first rose to prominence in the aftermath of World War I and World War II. It became the most trusted currency in the world in part because the United States’ allies used gold to pay back all the loans the country had provided. By the time all those loans were repaid, the United States owned the vast majority of the entire world’s gold. One could say that it was the golden age of the dollar.
When leaders from 44 countries hashed out the Bretton Woods Agreement, it was official. The dollar had become the world’s universal medium of exchange. However, over the past several decades, the dollar has been losing its prestige. In 1971, the United States under President Richard Nixon unilaterally canceled dollars-for-gold trading on international markets. That shift, together with the United States’ decreasing economic output, has created a vacuum.
The rise of cryptocurrencies like AXIA Coin could fill that void. But how does it stack up to other cryptocurrencies that could serve the same function? Here’s an overview of a few of AXIA’s three biggest competitors.
AXIA vs. Tether
Tether was the very first stablecoin to hit the market. Since the value of each Tether was to be backed up by an actual dollar, it promised all the advantages of cryptocurrency– mobile payment options, accessibility, low transaction fees, etc.– with none of the volatility. It debuted back in 2014 and became available via Bitfinex in 2015. However, questions about the legitimacy of Tether’s reserves began to swirl just a couple years after its debut. The crypto is now under investigation by the U.S. Commodity Futures Trading Commission and the United States Department of Justice. Despite this, Tether is still the leading stablecoin by market cap.
AXIA will not have any transparency issues for one simple reason: records for all assets will be available to the general public. All assets connected to AXIA will be held and managed by AXIA Reserve. Since these records are accessible via blockchain, anyone can verify them at any time.
In addition, the apps connected to AXIA Network will allow its users to use AXIA to buy things in the real world, which underscores its dual utility function. First, each user will be getting cashback rewards. Additionally, there is the benefit of the transaction fee and the continued value from it, resulting from doing things a user would normally do, such as getting coffee at a coffee shop or buying something online. That volume will be coming back into the AXIA system to build up the underlying asset base. So the value at AXIA comes in two ways, since the cashback reward could be worth more in the future, based on the fact that everyone is benefiting from this centralized activity, and from all of the utility and usability of AXIA as a currency.
In contrast, Tether and other stablecoins are predominantly used as a trading instrument to move funds in and out of crypto markets and hedge against market volatility.
AXIA vs. USD Coin
Peer-to-peer payments company Circle markets its USD Coin as “the fastest growing, fully reserved digital dollar stablecoin.” The second most popular stablecoin behind Tether is issued by regulated financial institutions and lines up on a 1:1 basis for actual dollars. These institutions are required to report their holdings on a regular basis, and financial advisory service Grant Thornton LLP verifies those reports on a monthly basis.
As mentioned above, AXIA is far more transparent than both Tether and USD Coin because it will be releasing the blockchain data associated with the holdings inside the AXIA Reserve and will be far more interactive for individuals to monitor all transactions in real time. AXIA nodes will be available for auditors, and AXIA will be providing its network statistics for everyone to see all activity within the system at any point of time. Unlike its competitors, AXIA users will be able to see what the holdings are and how that relates to the value of the currency.
AXIA vs. Libracoin
Crypto industry pundits were predicting that Facebook’s Libracoin would cause crypto to go mainstream when the social media pioneer announced its intent to release it in June of last year. Instead of using only dollars to back up Libracoin’s value, Libracoin’s creators opted to tie it to US Treasury securities and a basket of fiat currencies from various nations. Initially, Facebook’s partners in the project included big names like PayPal, eBay, Mastercard, Stripe, Visa, and Mercado Pago. However, all those brands left the Libra Association just four months later, when U.S. regulators intervened to stop Facebook from accomplishing its rollout plans.
Most importantly, Libracoin seemed to offer Association members a structure where assets were generating profits for those members off of fees that were collected from the users, effectively replicating the “us” vs. “them” system where value is siphoned away from platform users and funneled back to the already rich; while AXIA systems are designed to amplify and share that added value back with all ecosystem participants in a decentralized manner.
Conclusion
There are a few main features of AXIA that make it unique in comparison to Tether, USD Coin, and Libracoin. The first is that instead of relying either wholly or largely on the US dollar, AXIA Coin is tied to a variety of different assets and asset classes. These include real estate, art, precious metals and gemstones, but it can grow, shift and change to include any form or type of real world asset. The other unique thing about AXIA is its Asset Accumulation Algorithm, which rebalances the reserve automatically to hedge against inflation and other issues that plague fiat currencies.
To learn more about AXIA, connect with us on Twitter, LinkedIn and Facebook. Download the AXIA mobile application from Google Play or the App Store.
AXIA wallet services are provided by its partner, Balance, which ensures that your private keys are secure by generating and managing them on dedicated hardware, throughout their entire lifecycle. The hardware managing the offline (i.e. “cold”) wallets is kept offline in bank-grade vaults that are access controlled, monitored, and guarded 24/7. The hardware ultimately managing the warm wallets is provided by a cloud infrastructure provider and physically kept in a data center subject to similar protections and restrictions.
Any questions? Make contact with me and I will be happy to answer your questions as quickly as I can.
Best wishes to one and all.
This dynamic is problematic when the same parties guide monetary policy. Governments or central banks can expand or contract the money supply to achieve target inflation and interest rates. In a growing economy, stable, predictable inflation is acceptable to policymakers, given the marginal impact on purchasing power. However, over the long-term, inflation inherently devalues any fiat currency. At worst, the unchecked printing of money triggers destructive hyperinflation.
The common thread is this: everyday consumers suffer most for the shortcomings of fiat. But what’s the solution? To answer this question, the utility of digital currency must also be part of the discussion.
The arrival of blockchain-enabled cryptocurrency represents the next step in the evolution of money. These digital currencies live on-chain in the absence of a central authority. Instead of rolling off a printing press like fiat currency, cryptocurrency miners “mint” new tokens while competing for block rewards. It works like this: blockchain networks utilize a consensus mechanism, like Proof of Work (PoW), to validate transactions in the absence of a central authority. Miners compete to solve complex mathematical algorithms to validate transactions and add them to the blockchain. The successful miner receives block rewards in the form of cryptocurrency for their efforts.
While mining is responsible for the genesis of new cryptocurrency, secondary markets determine prices. Since emerging over 11 years ago, the cryptocurrency market has proliferated. As of October 2020, the total market value was around $450 billion, with new initiatives seeming to launch weekly. However, cryptocurrency prices remain highly volatile as the market maturation process continues. As such, digital currencies present questionable utility as a store of value or medium of exchange.
Stablecoins, originating from the realm of decentralized finance (DeFi), are built to tackle this shortcoming. These supported digital currencies maintain a 1:1 ratio with fiat currencies like the USD or EUR. However, many of the most popular stablecoins like Tether (USDT) and USD Coin (USDC) are still directly tied to the fiat’s value, in this case, USD. As such, price stability results at the expense of autonomy—a stablecoin backed by fiat still perpetuates harmful monetary policy. Governments and central banks can directly affect the value of these stablecoins by expanding or contracting the supply of fiat, causing inflation — the public has no control over the policies that may devalue their currency. Further, fiat-backed stablecoins hold collateral off-chain, resulting in a concerning lack of transparency.
AXIA Dual Blockchain Design
New solutions are necessary to ensure everyone benefits from the next generation of money. AXIA offers a fresh take on how a global reserve currency can be designed to benefit people beyond national borders. Although AXIA Coin is supported like a commodity-backed stablecoin, the allocation of value functions much differently. The AXIA Dual Blockchain Design highlights how this particular mechanism, and others, interact on the platform to achieve optimal stablecoin-like performance, but within a true open and decentralized marketplace.
The AXIA Coin Network Blockchain
The AXIA Coin Network Blockchain facilitates the transfer of value between participants. Users interact with this network through a decentralized application (DApp) built on a public blockchain network. Like some fiat payment networks, AXIA distinguishes between user groups—individual, business, or charity. The AXIA Transaction Link (ATL) operates as a series of connected smart contracts on the AXIA Coin Network Blockchain, executing transactions in line with predetermined user group rewards and fee schedules. Each of these transactions registers to the AXIA Coin Platform Blockchain for complete transparency.
The AXIA Reserve Blockchain
Every time ATL smart contracts trigger the collection of transaction fees, a specified percentage is allocated to the AXIA Reserve. This automated process results in a predictable flow of value to the platform reserve. The Asset Accumulation Algorithm (AAA) simultaneously deploys these funds to build up reserve holdings and maintain reserve value in any number of real-world assets including real estate, art, or commodities like gold and silver. As the AAA makes purchases, the records become visible in real-time to the public over the AXIA Reserve Blockchain. Those maintaining the security of the AXIA network, also known as nodes, can view every transaction. These nodes also provide real-time, third-party verification and disclosure of the asset-base valuation.
The Future of Money
In contrast to existing fiat and cryptocurrency frameworks, AXIA improves the utility of money by adding a fourth function—the creation of value. In combination with a finite token supply, the accumulation of real-world assets in the AXIA Reserve ensures that AXIA Coin grows more and more resilient. Further, by rewarding network participants based on their user group and enabling greater transparency, AXIA addresses the limitations of existing stablecoins and presents a unique approach to deploying a reserve currency with global scalability.
Whether we think about it or not, when governments print money they create debt and this process actually makes life harder for everyone, especially the poor and working class. As the inflation that is the inevitable result of this printing hits, the cost of goods goes up, while wages have remained relatively stagnant for the working poor. Though inflation is an issue almost everywhere, citizens in countries that have especially weak currencies– like Venezuela, Zimbabwe and South Sudan– have been hit especially hard.
Blockchain-based, supply constrained cryptocurrencies like Bitcoin provide one possible solution to the problem of currency inflation. However, nobody is quite sure how to value Bitcoin because it’s not backed by any real assets. In other words, people purchase and trade Bitcoin only because of its scarcity. As a result of that uncertainty and the speculative nature of freewheeling crypto markets, huge price swings are typical. Other cryptocurrencies like USDT, Reserve and Tether appear more stable because their supply is supposedly linked to a matched backing structure, leaving the digital tokens that exist in in the market linked to a provable supply of fiat money stable, but inflation is still an issue because the price of those coins are tied to fiat currencies. That’s where AXIA comes in. It’s a cryptocurrency project that’s attempting to create a new reserve currency for the world.
The case for a new world reserve currency
Does the world really need a new reserve currency? Some experts are arguing that it does. Moorad Choudhry, the former Head of Business Treasury, Global Banking and Markets at Royal Bank of Scotland, says that the United States economy now constitutes a steadily decreasing share of world economic output. If that trend continues, international monetary authorities may start looking for an alternative store of value.
The U.S. Dollar first rose to prominence in the aftermath of World War I and World War II. It became the most trusted currency in the world in part because the United States’ allies used gold to pay back all the loans the country had provided. By the time all those loans were repaid, the United States owned the vast majority of the entire world’s gold. One could say that it was the golden age of the dollar.
When leaders from 44 countries hashed out the Bretton Woods Agreement, it was official. The dollar had become the world’s universal medium of exchange. However, over the past several decades, the dollar has been losing its prestige. In 1971, the United States under President Richard Nixon unilaterally canceled dollars-for-gold trading on international markets. That shift, together with the United States’ decreasing economic output, has created a vacuum.
The rise of cryptocurrencies like AXIA Coin could fill that void. But how does it stack up to other cryptocurrencies that could serve the same function? Here’s an overview of a few of AXIA’s three biggest competitors.
AXIA vs. Tether
Tether was the very first stablecoin to hit the market. Since the value of each Tether was to be backed up by an actual dollar, it promised all the advantages of cryptocurrency– mobile payment options, accessibility, low transaction fees, etc.– with none of the volatility. It debuted back in 2014 and became available via Bitfinex in 2015. However, questions about the legitimacy of Tether’s reserves began to swirl just a couple years after its debut. The crypto is now under investigation by the U.S. Commodity Futures Trading Commission and the United States Department of Justice. Despite this, Tether is still the leading stablecoin by market cap.
AXIA will not have any transparency issues for one simple reason: records for all assets will be available to the general public. All assets connected to AXIA will be held and managed by AXIA Reserve. Since these records are accessible via blockchain, anyone can verify them at any time.
In addition, the apps connected to AXIA Network will allow its users to use AXIA to buy things in the real world, which underscores its dual utility function. First, each user will be getting cashback rewards. Additionally, there is the benefit of the transaction fee and the continued value from it, resulting from doing things a user would normally do, such as getting coffee at a coffee shop or buying something online. That volume will be coming back into the AXIA system to build up the underlying asset base. So the value at AXIA comes in two ways, since the cashback reward could be worth more in the future, based on the fact that everyone is benefiting from this centralized activity, and from all of the utility and usability of AXIA as a currency.
In contrast, Tether and other stablecoins are predominantly used as a trading instrument to move funds in and out of crypto markets and hedge against market volatility.
AXIA vs. USD Coin
Peer-to-peer payments company Circle markets its USD Coin as “the fastest growing, fully reserved digital dollar stablecoin.” The second most popular stablecoin behind Tether is issued by regulated financial institutions and lines up on a 1:1 basis for actual dollars. These institutions are required to report their holdings on a regular basis, and financial advisory service Grant Thornton LLP verifies those reports on a monthly basis.
As mentioned above, AXIA is far more transparent than both Tether and USD Coin because it will be releasing the blockchain data associated with the holdings inside the AXIA Reserve and will be far more interactive for individuals to monitor all transactions in real time. AXIA nodes will be available for auditors, and AXIA will be providing its network statistics for everyone to see all activity within the system at any point of time. Unlike its competitors, AXIA users will be able to see what the holdings are and how that relates to the value of the currency.
AXIA vs. Libracoin
Crypto industry pundits were predicting that Facebook’s Libracoin would cause crypto to go mainstream when the social media pioneer announced its intent to release it in June of last year. Instead of using only dollars to back up Libracoin’s value, Libracoin’s creators opted to tie it to US Treasury securities and a basket of fiat currencies from various nations. Initially, Facebook’s partners in the project included big names like PayPal, eBay, Mastercard, Stripe, Visa, and Mercado Pago. However, all those brands left the Libra Association just four months later, when U.S. regulators intervened to stop Facebook from accomplishing its rollout plans.
Most importantly, Libracoin seemed to offer Association members a structure where assets were generating profits for those members off of fees that were collected from the users, effectively replicating the “us” vs. “them” system where value is siphoned away from platform users and funneled back to the already rich; while AXIA systems are designed to amplify and share that added value back with all ecosystem participants in a decentralized manner.
Conclusion
There are a few main features of AXIA that make it unique in comparison to Tether, USD Coin, and Libracoin. The first is that instead of relying either wholly or largely on the US dollar, AXIA Coin is tied to a variety of different assets and asset classes. These include real estate, art, precious metals and gemstones, but it can grow, shift and change to include any form or type of real world asset. The other unique thing about AXIA is its Asset Accumulation Algorithm, which rebalances the reserve automatically to hedge against inflation and other issues that plague fiat currencies.
To learn more about AXIA, connect with us on Twitter, LinkedIn and Facebook. Download the AXIA mobile application from Google Play or the App Store.
AXIA wallet services are provided by its partner, Balance, which ensures that your private keys are secure by generating and managing them on dedicated hardware, throughout their entire lifecycle. The hardware managing the offline (i.e. “cold”) wallets is kept offline in bank-grade vaults that are access controlled, monitored, and guarded 24/7. The hardware ultimately managing the warm wallets is provided by a cloud infrastructure provider and physically kept in a data center subject to similar protections and restrictions.
Any questions? Make contact with me and I will be happy to answer your questions as quickly as I can.
Best wishes to one and all.