Coinbase Urges Developers To Build Inflation-Pegged Stablecoins Called "Flatcoins"
Approximately one month after the launch of the Layer-2 blockchain Base, Coinbase calls for the development of an inflation-adjusted stablecoin.
Because Bitcoin
March 28, 2023
Base, a secure and affordable Ethereum L2 designed for developers, was recently launched by Coinbase with the goal of bringing the next billion users On-chain. In addition to the Base announcement, the Base Ecosystem Fund was also introduced, which provides early-stage funding and dedicated support to projects built on Base.
Coinbase also identified key areas that require attention and issued a request for builders to work on these important areas.
Coinbase is seeking to explore and encourage the development of onchain reputation protocols to enhance trust on the blockchain. The company is interested in hearing from builders who are working on decentralized limit order book exchanges that leverage the high throughput of Ethereum L2s like Base, with the potential to offer deeper liquidity accessible through L2. Additionally, they are interested in tools that can protect against smart contract vulnerabilities and ecosystem attacks to ensure the safety of users' funds, with the goal of making it possible for every user to store their money onchain.
Most importantly however, Coinbase wants to build a so-called “Flatcoin”.
Coinbase is interested in the development of decentralized stablecoins, particularly 'flatcoins' that track the rate of inflation to provide stability in purchasing power while also offering resilience from economic uncertainty. They welcome the exploration of other forms of 'flatcoins' that do not peg to fiat but bridge the gap between fiat pegged coins and volatile crypto assets. Given recent challenges in the global banking system, Coinbase believes these explorations are more important than ever. They are excited to hear from teams working on developing their own stablecoin or flatcoin systems, or those focused on increasing adoption of existing systems such as Reflexer/RAI, Spot/Ampleforth, Frax/FPIS, and Olympus DAO.
Flatcoins are a type of stablecoin that aim to be pegged to the cost of living by tracking consumer price index and inflation data, rather than a reference asset like the U.S. dollar. Coinbase expressed interest in exploring other concepts that bridge the gap between fiat-pegged stablecoins and volatile cryptocurrencies.
Investor Ray Dalio endorses the idea of an "inflation-linked coin" to protect consumers' purchasing power, stating that it would be a valuable asset for saving and transacting. In his interview with CNBC two months ago, he also criticized Bitcoin and normal stablecoins.
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