Stablecoins have been around for a while, but this is the first time one has been pegged to electricity. A stablecoin is a crypto asset that is pegged to the value of another currency, equivalent to 1 unit of fiat. Because they are not backed by a real asset, the prices of these freshly minted digital assets can vary drastically and become unstable in the early days.
The Lawrence Livermore National Laboratory in California has merged statistical mechanics and information theory to build an electric stablecoin (e-stablecoin) that would transmit blockchain renewable energy in the form of information. Let’s see how the world will evolve as a result of it.
A Stablecoin That Is Pegged to Electricity? You’d Better Believe It!
Humans have been attempting to build stable assets that provide a consistent, trustworthy value since the dawn of humanity. The P2P e-stable coin is the most recent kind of asset, which can be generated with one kilowatt-hour of electricity and a charge. The rate for this coin will be stable for the entire year and won’t fluctuate much.
Maxwell Murialdo and Jonathan L. Beloff of Livermore designed this first fully collateralized stablecoin. This breakthrough will enable users to transmit electricity without the use of physical cables or grids, resulting in a completely collateralized stablecoin with little energy usage.
A decentralised network of data storage clouds will provide a way to store assets and track information without the need for central control or trust. Smart contracts with decentralised data storage cloud will govern the entire procedure.
Why Does the Need for an E-stablecoin Arise?
The world of crypto assets has seen a lot of changes in recent years, with peer to peer stablecoins taking centre stage. Although there has been a lot of hype surrounding these digital assets, there are still several key challenges that need to be addressed in the market. The electricity utilised to mint e-stablecoins is easily sustainable.
Read About: Is Bitcoin Sustainable?
With the introduction of e-assets, investors can now trade in a digital asset that is stable and cost-effective to mine. These coins are created when the electricity price is low, and the token is generated when the price of electricity goes up.
Murildo and Beloff describe their work as a proof of concept in their publication, and they made substantial use of advanced mathematics in their reasoning. To create a working e-stablecoin, “further advances that increase speed and reduce the amount of power needed would be crucial. They conclude that this is feasible to achieve using quantum computing, which will allow new possibilities for crypto-assets.
With the continual increase in data storage, scientists have found a way to store more information in less space. One company has developed a new type of hard drive that stores data on top of a magnetic surface instead of spinning bits. This allows for the use of 10 times less space than traditional hard drives and is environmentally friendly. In the meantime, this innovative idea has also had theoretical implications for how cryptos derive their value.