“Having a cryptocurrency that follows the value of the local currency will make life easier for those who want to implement on the blockchain. We see that the economy is going to be tokenized more and more and having an asset denominated in local currency on the blockchain is going to be a tool that leads to the use of these stablecoins, to simplify life“he told Telam Santiago MigoneCOO of Num Finance.
The NuARS backing mechanism is mixed collateralization, that is, for each token that circulates, it is backed by a stable cryptocurrency that follows the dollar (USDC or DAI) and as collateral in fiduciary money.
In this way, it is guaranteed that the value that each token in circulation has, at least, another that supports it that must be equal or greater value.
Currentlythe company assures that there are more than $120 million of NuARS in circulation and that they can be acquired through Buenbit, although they are working together with other Argentine and foreign companies to expand their use to other platforms and even countries.
In fact, they already have a NuPEN (equivalent to the Peruvian Sol) in progress and are working to launch two other similar tokens in Mexico (NuMXN) and Brazil (NuBRL), with the idea of expanding the use of stable cryptocurrencies from Latin American countries and, thus, decentralized finance.
“We aim to be part of the financial services that blockchain has to provide. We want to be the gateway to providing better DeFi tools (Decentralized Finance, in English) throughout Latin America,” added Migone.
The main use that NuARS have today are collateralized loans, a mechanism through which users of the platforms associated with Num Finance can leave DAI as collateral and withdraw NuARS, in a ratio of 120% backing for each NuARS loaned.
This allows the interest rate at which it is lent to be very low.since the risk of uncollectibility is nil given that, in the event that the level of capital and interest reaches 0.9 for each DAI of guarantee, that collateral is automatically sold, the debt is settled and the remaining money is returned to who took the loan.
In addition, people who hold NuARS can invest them and receive rewards in return that are paid back with the interest the company receives on the loans, adding a new use to this technology.
“We are convinced that this technology will continue to grow and that new uses can be incorporated, such as the possibility of sending remittances by creating a network of multi-Latin currencies, payments and other uses,” he concluded.
Source: Ambito
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