Fintech company Blackfridge has launched a new stablecoin tied to the value of the British pound. The Isle of Man-based company has said its coin, called “poundtoken”, is the first fully backed GBP stablecoin regulated in the British Isles.
Stablecoins are a form of cryptoasset that have their value linked to something else – in this case, pound sterling – with the aim of making its value more stable than other cryptocurrencies.
Blackfridge said that accounting firm KPMG has been appointed as auditors of the stablecoin and will confirm monthly that all issued tokens are fully backed.
“Following the boom in decentralised finance, stablecoins have become an integral part of the crypto sector,” said Nicholas Maybin, COO of poundtoken.
“Many are aware that the crypto market can be unpredictable, so when trading a stablecoin it’s vital to know that you will always be able to take out what you put in.”
Maybin has promised “robust regulation” to ensure the stability of the coin, which will be traded as GBPT.
Despite stablecoins having less volatile price changes than other cryptocurrencies, they are by no means incapable of dropping in value. This was demonstrated by TerraUSD (UST), an algorithmic stablecoin pegged to the US dollar, which dropped to $0.10 in May, while its associated stablecoin Luna plummeted to virtually nothing.
“It’s no secret that the last few weeks have been difficult for the cryptocurrency markets, particularly for unregulated or unbacked stablecoins such as UST,” said Alan Sun, CEO of poundtoken.
“For stablecoin holders, GBPT offers a unique combination: the stability of the British pound, and the reassurance of strict British financial regulations, combined with the speed, transparency, and integrity of the blockchain.”
Blackfridge is regulated by the Isle of Man Financial Services Authority, with the British Crown dependency’s government granting it a license back in April.
“British financial regulation and regular audits offer buyers peace of mind that their poundtoken can be cashed out one-for-one at any time,” added Sun.
Blackfridge, which is backed by Gate Ventures and FunFair Ventures, said that poundtoken will launch on trading platforms Gate.io, Bittrex Global, and Uniswap.
The launch of poundtoken follows an announcement from Tether – known for its USDT coin – last month that it plans to launch a GBP-backed stablecoin of its own.
It comes as the Treasury aims to make the UK a “global cryptoasset technology hub”, which will involve new legislation to promote the use of stablecoins and the Royal Mint creating an NFT.