Trust is the backbone of the world of finance. Without trust, there are no deals, no transactions, no loans, no insurance, and so on. Transparency breeds legitimacy and trust. As a matter of fact, a completely transparent financial ecosystem is theoretically free of regulators. It comes as no surprise that the world is progressing towards becoming more transparent.
Blockchain and cryptocurrency markets are giving us windows into a world in which transparency, not regulation, serves us. Some projects in the crypto ecosystem are dedicated to solving transparency issues but there are other projects whose very existence and integration brings transparency.
USD Reserve is one such project. Before looking into how USDR ensures transparency, it is important to understand what exactly USDR is.
What is USDR?
In essence, USDR is a crypto token or payment token. It is issued by Brothers International in Switzerland. This token is fully backed by a corporate guarantee from Brothers International in the UK. Brothers International is the legal owner of 10 metric tonnes of gold stored in private secure storage and insured by Lloyds of London, the world’s leading insurance market providing specialist insurance services to businesses. The terms of guarantee between the UK and Swiss entity entails the UK entity to support the Swiss entity’s USDR project.
USDR is a European payment token designed to be the internet’s reserve currency. They are currently issuing 100M coins within the current regulatory framework and plan to grow this volume shortly to 345M coins. They intend to provide a flexible payment token on multiple blockchains that can become the reserve currency of the internet. USDR tokens are pegged one to one with the U.S. dollar that helps to fix the volatility flows. The token is currently available on ERC20 and Binance Smart Chain, and other chains are coming soon.
Transparency Through Supply Tracker
A question naturally arises. How is Brothers International obtaining the gold?
The gold is purchased at a fair price from Artisanal miners in some of the poorest places in the world. Miner’s safety is on the top of the priority list. The miners are also trained on how to extract gold without using environmentally damaging chemicals and mercury, which many currently use now.
Lloyd’s of London has conducted complete due diligence, provenance, security, and assay audits on the assets (gold) that subsequently back the USDR. Lloyd’s is a corporate body governed by Lloyd’s Act 1871 and subsequent Acts of Parliament, and unlike most of its competitors in the industry, it is not an insurance company.
This way the gold reserves always remain verified and the transparency of the reserves is always up for the public to see. Minting new coins means adding more gold reserves. If the gold price appreciates, more coins can be issued and if the gold price declines, either more reserves can be added, or coins can be burnt. Any coin burning or mining event will always be announced to the public.
Thus, in this way, USDR is not only ensuring that it reaps all the benefits of transparency that comes with being built on a blockchain, but also ensures transparency in their supply chain of obtaining gold reserves and minting or burning tokens.
