Wednesday, 14 December 2022 01:40 PM
Product Announcements
OSLO, NORWAY / ACCESSWIRE / December 14, 2022 / Stablecoins are often issued using USDC, DAI, or ETH. Following the mint, the corresponding quantity of a stablecoin is secured (collateralized) in a multi-signature smart contract ("multi-sig" wallet) or Multi-Party Computation (MPC) wallet.
All backed stablecoins employ either "cryptocurrency" or fiat backing (for example, USD), although commodity-backed stablecoins exist. While token backing occurs on-chain, currency and commodity backing occurs off-chain.
When the stablecoin supply declines, the issuer cuts the supply to maintain the stable price connected to the reference asset.
Disadvantages
The drawbacks of securing a token with a stablecoin (which is subsequently tied to a fiat currency) or with fiat cash backed directly introduce new risks.
- Inflation
Fiat currencies are lousy at preserving value since they lose value nearly often.
The US Dollar lost 97,16% of its value from its birth in 1635 to 2021, while other currencies lost considerably more in far shorter durations. In addition, inflation should not be overlooked in the near term.
- Shady Enterprises
Low- or unregulated offshore locations drive the major stablecoins' business models, and they lack transparency and adequate investor protection.
A New Approach Using an Inflation Hedge
Alf Gunnar Andersen, the interim CEO of Bustad Eiendom AS, saw the unresolved concerns of inflation and transparency and considered possible solutions. Consequently, the Bustad currency was created to protect as much collateral as possible by holding fractions (max 20%) of housing properties, putting them on the Ethereum blockchain, and naming them Bustad coin.
According to the whitepaper, "real estate has proven to be a good hedge against inflation. Private real estate tightly correlates with consumers' purchasing power, which is the reason for inflation. This makes real estate a great store of value where your money retains its purchasing power." As the collateral value grows, so does the value of the Bustad coin.
Investors who are interested in Bustad
- Long-term investors seeking property exposure and, most likely, decentralized financing solutions in the future.
- Mid-term investors who acquire Bustad currency are eligible for the Eigar governance token, which has the largest price growth potential.
- Investors interested in low volatility who believe in tangible assets on the blockchain rather than fiat currency.
The governance token's upward potential represents a reasonable risk-reward ratio for investors. As shown by the Horde App, Alf Gunnar, the primary driver of this project, has an amazing track record of accomplishing tasks. It is one of the most popular Financial Advisory applications in Norway.
Legal Structure
The legal structure of Bustad is as follows:
- As a self-owned and non-profit organization, the Bustad Association owns Bustad Eiendom AS.
- The Bustad Eiendom AS owns and administers the housing portfolio's acquisitions and sales.
Tokenomics
- Bustad coins (BUSC) are created via an Ethereum smart contract and a non-custodial wallet. The collateral is sent to the Bustad multi-sig wallet, while the flat coin is delivered to the non-custodial wallet. So far, around $40k BUSC has been coined.
- The Eigar governance token: Until the first $25 million BUSC is coined, the minter is entitled to one Eigar token (EIG) for each BUSC produced. EIG is designed to give its holders a voice in the Bustad Association, which makes policy decisions. The initial 25 million tokens have a 1:1 ratio. The next 25 million tokens are worth two BUSC tokens for one EIG token (2:1). Following that, each of the 25 million Bustad coins will be halved.
- 100.000.000 EIG have been pre-mined, with 50% committed to Busad coin minters and 25% controlled by Horde AS, which also provides much of the infrastructure through a service-level agreement. The remaining 25% is for the team, partners, and the Bustad Association.
Media Contact:
Name: Timm Erbach
Website: https://www.bustad.io/
Mail: [email protected]
Address: Bolteløkka alle 11a
0454 Oslo
Norway
SOURCE: Bustad