Researchers at Lawrence Livermore National Laboratory in California have designed a new type of stablecoin that is pegged to electricity. This revolutionary class of stablecoin could transmit energy as a form of information, making it a ground-breaking approach.
According to the scientists, anyone can this stablecoin through the input of one kilowatt-hour of electricity, plus a fee. Following that, users can trade this stablecoin just like a traditional stablecoin. Smart Contracts take hold of the entire process, connecting it to a decentralized data storage cloud.
Due to this, no trusted centralized authority can maintain or disburse the asset. Moreover, this would become the first hard-pegged stablecoin, directly exchangeable for a specified quantity of a physical asset. Also, the scientists suggested that since electricity has a highly stable price and demand, it can become an easy sustainable proposition.
Moreover, investors can mint E-Stablecoins in regions where electricity prices are low. On the other hand, they can burn the tokens where electricity is more expensive.
Livermore’s Maxwell Murialdo and Jonathan L. Belof described their work as a proof of concept. Moreover, they also incorporated extensive use of advanced mathematics for their reasoning. However, the scientists also stated that to make a working E-Stablecoin, “further advances that increase the speed, transfer entropy, and scalability of information engines will likely be required.”
Besides all this, there is also the need for improved cloud storage. Meanwhile, their research has theoretical implications for the way in which cryptos derive their value.
The team published their work in the peer-reviewed journal Cryptoeconomic Systems on Monday.