Civic launches its KYC service with BitGo and the UK Royal Mint.
Tether is on the brink of collapse... Regulators are cracking down on money-launderers and illegal traders... prices are crashing... the world of cryptocurrency is in upheaval.
Just another day in crypto, right?
Here's an interesting confluence of events. First, we have Tether - a cryptocurrency that is intended to be a token pegged to the value of the US dollar. It's in trouble. Turns out, they probably do not have a reserve that matches the amount of tokens they have issued, bringing into question the true value of the market.
Next, you have regulatory crackdowns and pressure to reduce anonymity and fraudulent behaviour in the market, encouraged by recent scam-fiascos such as BitConnect ponzis and take-the-money-and-run ICO's.
And then you have Civic. A token that will be used to verify and protect identity while reducing costs of KYC procedures. Not only that, you have a major mint - the UK Royal Mint, issuing a gold-backed cryptocurrency - Royal Mint Gold (RMG).
BitGo, a newly announced Civic partner, will host wallets that are used to store RMG. The Civic KYC service will be used to safely access RMG on the hosted wallets.
So you have a gold-backed cryptocurrency, protected by KYC blockchain technology, that is supported by one of the most reputable mints in the world.
Even fiat doesn't have this kind of backing. No, really, it doesn't.
Joking aside (fiat has virtually no backing when you really look into it), this could be a big win for the cryptocurrency market. Will there be a time in the future when mint-issued, gold-backed currencies become a new sort of "Tether"? If a trader could trade, say Bitcoin, directly for RMG, this sets a new precedent for the authentic value of cryptocurrency.
This may be a long ways off. Part of the reason USDT has been used so widely on the market is that it skirts around many legal issues faced with fiat. It's likely that anything backed by a Royal Mint would face the same sort of legal scrutiny. Many exchanges have stuck to Tether primarily because it is much easier to deal with legally than government-issued currency.
The real winner here, it appears, could be Civic. For this token to see serious, real-world utility that is not frivolous - but is a genuine usage of the token, accepted by a major institution, is a true victory for the company behind its development. As Civic is adopted by more major companies and perhaps other government institutions, it could create a network effect that brings Civic to the forefront of blockchain tokens with a true utility and value.
sources:
https://cointelegraph.com/news/uks-royal-mint-launches-gold-backed-cryptocurrency
https://www.coindesk.com/bitgo-use-civic-id-service-royal-mints-digital-gold-trial/
image source:
https://www.marketwatch.com/story/gold-above-1350-best-since-september-as-dollar-knocked-lower-2018-01-24
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