A Brief Introduction to Hash DollarTM - The First Stable Cryptocurrency
Introduction
The purpose of this Paper is to briefly explain the new digital currency “Hash Dollar”, or simply “hashdollar”. Its name derives from being a “cryptocurrency” ‐ a digital currency where values are transferred basically by solving cryptographic computer hashes.
Hash Dollar (currency code XHD) is designed to be a P2P decentralized cryptocurrency similar to Bitcoin, except by its value being steady, pegged to the U.S. dollar (USD).
Technical details will be released on a separate Paper.
The Challenge
Since Bitcoin inception in 2009, users of cryptocurrency were challenged with extreme volatility of its market price. In 2013, Bitcoin’s market value was $13 USD in January, $1203 USD in the beginning of December, and today its value is approximately $670 USD (see graph below). Furthermore, all the new “altcoins” released in the market afterwards suffer from the same issue ‐ main reason for not being widely acceptable in most business transactions. The volatility of current cryptocurrencies could be a virtue for an investor, but certainly it is not for merchants and traders. In addition, even if you are an investor, there are times when you need to “go fiat” (i.e. exchange your cryptocurrency for cash, legal tender) in order to stabilize your gains, or stop your losses. When you exchange your cryptocurrency for cash, you lose the main advantages of cryptocurrency: anonymity and decentralization, usually paying high exchange fees.
Current Solutions
At this moment, some projects are under development to solve the volatility issue: Bitshares, Mastercoin and Next, while Ripple Labs already released its XRP. All are valid solutions; however they all take the same “IOU” approach: people lending money to each other. We believe the IOU approach is overly complicated for the average person to use, so we’ve designed Hash Dollar: a much simpler and efficient solution.
The Hash Dollar Solution
In a different approach, in order to achieve stability of our currency, we decided to back it by a universal accepted physical commodity1, whose market price index is openly listed in US dollars worldwide. Hash Dollar is the first and only digital currency backed by a commodity.
For that purpose we created two entities:
1. HashDollar.org: A non‐profit organization responsible for Open Source software and distribution of currency through “miners”2. The long term USD average inflation rate (registered and calculated since year 1913) is already included in Hash Dollar’s protocol and applied to miner’s increasing rewards, adjusted for USD inflation;
2. HashDollar.com: A multinational Corporation that owns the reserves of commodity, and redeems Hash Dollar for its respective value in commodity, as per users’ request. This Corporation will own “premined”3 Hash Dollars in amount equivalent to USD/XHD value of its total projected reserves, minus projected total XHD mined until the end of the year 2025, not considering future inflation. Total amount of “premine” will be disclosed upon release of Hash Dollar Open Source code.
The USD market price of the commodity will be posted4 daily on HashDollar.com. When the USD market price of our commodity increases, XHD price automatically follows to the same value, thus maintaining the USD/XHD parity of 1:1. In other words, the XHD trade price of commodity the user can redeem it for; will always be the same as its USD trade price. Consequently, XHD becomes pegged to USD.
This 1:1 XHD/USD parity is important for common use of cryptocurrency on day‐to‐day business. People worldwide are used to USD ‐ the widespread accepted international reserve currency – thus making the transition to XHD extremely easy, aside from the fact that the XHD currency format follows the US dollar format, just adding a # (hash) in front of the dollar sign: #$ 1,000,000.00 (read as “one million hash dollars”).
Additionally, a savings mechanism is included in the protocol in order to maintain users’ purchasing power.
Conclusions
Hash Dollar presents a significant opportunity for users, merchants, investors and traders to leverage the use of cryptocurrencies. It complements Bitcoin, and it is ideal for day‐to‐day use.
Hash Dollar satisfies users’ needs for an anonymous and decentralized digital currency, while serving as a stable and completely legal “safe haven” for the cryptocurrency world.
Fonte:
http://www.burbuja.info/inmobiliaria/bolsa-e-inversiones/494771-primera-criptomoneda-respaldada.html
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