Another great alternative in stablecoins FDUSD.
First Digital USD (FDUSD) is a reserve-backed stablecoin, launched in June 2023 by First Digital Limited, a financial company based in Hong Kong. Its main objective is to maintain a 1:1 parity with the US dollar.
Here is a summary of its key features:
Backing and Transparency: FDUSD is fully backed by cash or cash equivalents (such as short-term US Treasury bills and overnight reverse repos).
Functioning: When a user deposits US dollars with First Digital Trust, an equivalent amount of FDUSD tokens is issued. Conversely, when FDUSD is redeemed, the corresponding tokens are "burned" (destroyed).
Networks and Compatibility: Initially, FDUSD was launched on the Ethereum and BNB Chain networks (formerly Binance Smart Chain).
Use Cases:
Remittances: It enables fast and cost-effective cross-border transactions, offering a cheaper option compared to traditional bank transfers.
Payment Solutions: Businesses and individuals can use FDUSD to process payments with lower fees and faster processing, especially useful for international transactions.
Protection Against Volatility: Given the volatility of cryptocurrency markets, FDUSD can be used as a "hedge" or an "anchor of stability" to protect investments or secure profits during periods of significant price fluctuations.
Risks: Like all stablecoins, FDUSD is not free from risks. Although it is designed to maintain 1:1 parity, external events or issues with the issuer could lead to a temporary loss of parity (as has been reported on some occasions).
In summary, First Digital USD presents itself as a transparent and backed stablecoin, aiming to offer stability and efficiency in the cryptocurrency ecosystem, serving as a bridge between traditional finance and the digital world.
