These days, one SDR is worth about $1.40 USD, and SGA will be worth the same when it launches. But SGA’s value can go up or down depending on how many other people are using SGA. To buy this cryptocurrency is to cause Saga’s smart contracts to generate it from scratch. To sell it back is to burn the coins. So the monetary value of SGA can change, but the idea is that any change in price happens slowly and sustainably.
Saga’s SGA digital currency relies on an international reserve asset called Special Drawing Rights (SDR), which was introduced by the International Monetary Fund in 1969. This is a conventional basket of major world currencies – the US dollar, the euro, the British pound sterling, the Japanese yen, and the Chinese renminbi – that central banks around the world use to hedge against fluctuations in their own local currency. SGA borrows this model for a financial instrument and puts it on the blockchain.
Upstart crypto company Saga wants to issue a new global currency on the blockchain. Just don’t call it a stablecoin.
So SGA is not a stablecoin with a permanently fixed price. But you could fairly call it a “stable currency.”
“It’s increasingly clear that for a global economy, we need a global currency”, said Saga founder Ido Sadeh Man. “If we want to achieve this, we need to answer a few questions. Who controls it, how do you tame volatility, and is it legitimate?”
Saga treats its token holders as sovereign. Yes, Man started the business, but Saga uses an Ethereum-based governance model that makes it possible for holders to elect a board of directors or another monetary committee that ignores his wishes entirely.
Saga is ultimately an ERC-20 token system that also adheres to AML and KYC practices. While the thought of regulating some new global currency might seem silly, this compatibility should be quite appealing to policymakers. Man explained that Saga probably won’t achieve status as a means of exchange within a year or two of launch – why hold it if no one accepts it, and why accept it if no one has it? Instead he suggests SGA will find its first applications within hedging.
When asked about his currency playing a role in a world hypothetically free of geopolitical borders, Man said, “It’s obvious that nation-states can’t handle all our identities for all our lives, but I don’t believe that my generation will witness that, and probably not my children’s generation either.”
SGA launches on December 10th and will be available for trading on Liquid.
This File-Sharing Dapp Shows How Blockstack and Ethereum Are Different
The Blockstack file-sharing dapp Envelop, which works a little like WeTransfer but with encrypted storage via the blockchain platform, just launched a browser extension for Chrome, Firefox and Opera.
Now desktop Blockstack users can simply upload files to the extension and drop them in emails or direct messages even if the file is normally too big.
“With Blockstack, there’s the knowledge of where your files are stored at any given time”, Envelop co-founder Sérgio David dos Santos told CoinDesk.
He added that users can’t lose access to the file, stored via Blockstack’s distributed system, plus no one can share or access the file without the owner’s knowledge, including Blockstack itself.
Dos Santos said the web app has attracted 1,000 users since launching in June 2019, which puts it on par with most ethereum-based dapps outside of the gambling and financial services sectors.
But while ethereum companies generally viewed each app as an independent product, groups building on the Blockstack platform have gone a different route.
To date, Blockstack has raised roughly $75 million through a combination of venture capital and several token sales from 2017 to 2019, first to accredited investors then following the U.S. Securities and Exchange Commission’s Reg A+ crowdfunding exemption.
The company then set aside a pool of funds that could be distributed to projects when they attract users. Blockstack CEO Muneeb Ali told CoinDesk the App Mining incentives program has paid $900,000 worth of bitcoin to more than a dozen projects since it started in November 2018.
The distributions are modest. Envelop, for example, has only received $3,784 from the program since June, according to Dos Santos. For comparison, Dmail, an encrypted email service built on Blockstack, has earned $23,000 so far.
For many Blockstack projects, those small figures are not problematic. Envelop, for example, is a side project of web development firm Bloco, itself a mom-and-pop consulting firm run by Sérgio David and wife Claudia dos Santos.
Like Dmail and many other Blockstack projects, these are established companies that aren’t looking to monetize their side projects, or raise venture capital for them, in the near future.
“The good thing about the app mining program is it gives you a way to bootstrap, to test the waters”, Sérgio David dos Santos said, adding:
“The community is still figuring out what are the best business models to build on top of decentralized applications. It’s tough to switch your mindset from normal business models to models that are more ethical.”
If creators don’t want to collect user data or sell storage options, however, the question remains: How to capture value from the software they’ve built and maintained?
“If we make our project open-source, if we let you take care of the storage itself, what else do we have to offer?” he asked. “We’re working through a few options.”
It also remains to be seen how valuable the App Mining program’s support will be when the program switches in November from paying in bitcoin to Blockstack’s native token, STX. Blockstack CEO Ali said if an exchange listing of STX were to occur, it would take place on an international exchange that would only serve non-U.S. individuals. He said the listing would likely happen in October 2019, though possibly later.
“Our plans for completely switching out bitcoin for STX might change as we’re actively tweaking and improving the App Mining program during the pilot phase”, Ali added.
In the meantime, the Envelop team is focused on gaining users, beyond crypto circles, and learning about their needs.
“In the long run, we’re looking to develop an iOS app and also a Mac desktop application”, David dos Santos said. “We’re still feeling things out.”
