Celo Launches Decentralized Open Source Financial Services Prototype
Forbes notes that other financial transaction platforms hope to benefit from Facebook’s struggles in launching its Libra cryptocurrency — including Celo.
The key value proposition of the assets running on top of the [Celo] platform is that they are immune to the wide swings in volatility that have plagued leading crypto assets in recent years. Many are designed to mirror the price movements of traditional currency, and most have names that reflect their fiat brethren, such as the Gemini Dollar. This is a critical need for the industry, as no asset will be able to serve as a currency if it does not maintain a consistent price. However, rather than being a centralized issuer that supports the price pegs with fiat held in banks, Celo has built a full-stack platform (meaning it developed the underlying Blockchain and applications that run on top), that can offer an unlimited number of stablecoins all backed by cryptoassets held in reserve.
Furthermore, Celo is what is known as an algorithmic-based stablecoin provider. This distinction means that rather than being a centralized entity that controls issuances and redemptions, the company employs a smart-contract based stability protocol that automatically expands or contracts the supply of its collateral