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.
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.