The Winklevoss twins are continuing to make waves in the cryptocurrency world. This Monday, the pair received regulatory approval for the Gemini dollar – a cryptocurrency pegged to the US dollar.
Famous for having played a role in the founding of Facebook – and later receiving $65 million in a lawsuit against Mark Zuckerburg – Cameron and Tyler Winklevoss have been active in the cryptocurrency world for some time now.
They aren’t alone either. Paxos Trust Company, a financial technology firm, also received regulatory approval to launch Paxos Standard this Monday. As with the Gemini dollar, the cryptocurrency will be pegged to the US dollar.
Both coins received regulatory approval from New York state. Given that one of the raisons d’etre of cryptocurrency is its anarchic nature, some may be wondering why a coin pegged to the dollar would be useful. Speed, it seems, is part of the answer.
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Winklevoss and Paxos – digitising dollars
“Being able to move payments 24 hours a day, seven days a week and make payments programmable in a dynamic way is still very difficult,” Paxos Chief Executive Chad Cascarilla told Reuters on Monday.
Payments will also surely have played a role in both companies’ thinking. The huge volatility of most cryptocurrencies means that firms are unlikely to take payments in them. A currency tied to the dollar could assuage those fears.
There would, one hopes, have to be some other incentive here for use of the coins. Otherwise, there doesn’t seem to be any reason why firms, at least in the US, won’t just continue taking regular dollars.
For the Winklevoss brothers, this is just another step on a (relatively speaking) long journey in cryptocurrency. The twins launched Gemini, a cryptocurrency exchange, in late 2015. At the peak of the cryptocurrency boom in December of 2017, the two brothers reportedly owned over a billion dollars’ worth of Bitcoin.
More recently, the brothers have attempted to launch a cryptocurrency exchange traded fund (ETF). Unfortunately for them, their attempts thus far have been stymied by the Securities and Exchange Commission, a US regulator.