What is a Pegged Cryptocurrency in the current market

What is a Pegged Cryptocurrency in the current market

What is a Pegged Cryptocurrency? The market of cryptocurrencies does not stand still and with each year everything evolves, acquiring new tools and extensions allowing more actively trading crypto-currencies and making money successfully using them. One of these innovations is the use. The work describes ways to build “pegged sidechains”. Sidcheyns themselves are not something new: the ways to create them and the idea of their creation are discussed for a certain time.

Table of content

  • Value of pegged cryptocurrency
  • What is Komodo
  • Advantages and features
  • Focus on decentralization
  • Pegged order or Peg order

Value of pegged cryptocurrency

This literally means affordable, dependent on another currency; refers to currencies whose exchange rate changes when the exchange rate of another currency changes. The binding can be either rigid or including a variation interval.

Decentralized exchanges and shops

  • Currently, there are several decentralized places that allow you to directly trade with each other. Decentralization works here using user computers as an infrastructure. Decentralized markets are only emerging. Today there are not so many options, many are still under development.
  • One of these exchanges, allowing you to trade and use such a trading tool as “Market Pegged Assets” and BTS is Bitshares.
  • On this platform you can actively use pegged cryptocurrency and to receive from this income.

What is Komodo

  • This is a block-platform that offers highly secure and decentralized hosting of blocks. Additional benefits include the presence of several wallets and tied assets.
  • The platform adds a new feature to previous developments of SuperNET, which increases security through notarially certified nodes. The initial payment of coins ended on November 20, 2016 and was aimed at raising funds for the further development of the project.
  • The KMD block code allows users and founders to exchange information and integrate them on their own platforms, effectively improving the whole system of the chain.

Advantages and features

What currencies are pegged to the US dollar? Virtually all cryptocurrencies are linked to the dollar, since they are designed with this in mind.

1) Security on the block is implemented and implemented using two key functions: deferred work confirmation (dPoW) and notarized nodes. With a delay Proof of work, every transaction on the blocker gets the same level of security, which is better than the block chain of bitcoins.

  • Additional security is achieved through notarized sites, which are selected by coin holders. Notarial certification currently uses 64 notary nodes.
  • Notarially certified nodes not only guarantee that the chains attached to the km concern the safety of Bitcoin, but also reduce the complexity of mining.
  • Conventional nodes block the protection of Blockchain from chains that are attached to the Komodo Blockchain, and restore the normal production complexity. It should be noted that the loss of notarially certified sites (for whatever reason) did not destroy Komodo-Blockchain.

2) Multi-paper purses: a purse refers to a platform on which a person can store his cryptocurrency or digital assets on a blockchain.

  • Komodo Blockchain offers users and developers a variety of wallets. Desktop wallets can be downloaded on devices running on Windows, Apple and Linux operating systems.
  • In addition to desktop wallets, Komodo makes available purse paper (no paper is encrypted) and compatibility with hardware wallets, such as Ledger Nano S.

3) Atomic swaps: The obvious concern that would arise in many people is how risk-free transactions can be conducted from one purse to another.

  • Safe komodo;
  • As already mentioned, Komodo ranges from desktop to paper and hardware wallets. Fortunately, Komodo Blockchain allows you to transfer funds or transactions between purses or between cryptocurrencies without any inconvenience or security risks in many typical cases when atomic exchange can be performed.

4) Pegged Assets: The Komodo platform allows users and developers to attach their trading assets to relatively stable assets and fixed currencies, such as the US dollar or the euro.

When linking such assets to more stable currencies, the volatility of prices for crypto-currency assets can potentially be reduced.

Focus on decentralization

  • Perhaps the most attractive feature of the platform is its decentralization. This means that users and developers are not completely dependent on a platform to service the ecosystem from a single point of failure.
  • The KMD team is at the disposal of developers and other platform users to help in the development of specific functions or the use of functions.
  • It itself has many technologies, and since its users have independent block circuits, they have the right to choose which technologies to use and which technologies to disable.

Pegged order or Peg order.

Peg order.

  • This order automatically changes its price after the change in the bid / ask price. To issue this order, in the glass in the price field, indicate the worst price at which you agree to buy the share and press the P / D button.
  • In the Pegging & Discretion settings window that appears, in case of purchase, select Ask, and in the Modifiers field, select Down and specify the desired offset in cents.

Similarly, to put a Peg order for sale, you must select Bid and Up. The value of Midpoint you can choose for both a buy order and a sell order.

This type of order operates through the ARCA route.

Example.

  1. The XYZ share has a current quote of 15.23 x 15.28. You want to buy 300 shares of XYZ not higher than $ 15.30 with the help of an automatically updated limit Peg order, which will be 3 cents below the best offer. The best selling price is $ 15.28.
  2. Your order for the purchase of 300 shares of XYZ will be exhibited at a price of $ 15.25. (15.28 minus 0.03). Suppose that someone sold you 100 shares at $ 15.25 and after a while the stock quotation changed to 15.25×15.32. Now the current best offer price is $ 15.32.
  3. Your order for the purchase of the 200 remaining shares will be placed at a price of $ 15.29. Suppose that someone sold you another 100 shares at $ 15.29 and after a while the stock quotation changed to 15.29 x 15.37.
  4. Your application should be exhibited at a price of $ 15.34 (15.37 minus 0.03). Since as the worst price you indicated $ 15.30 then the warrant for the purchase of the remaining 100 shares will be exhibited at a price of 15.30 and will no longer increase.
  5. If after a while the price of the stock drops and the quote is 15.30 x 15.31, then your application for the purchase of the remaining 100 shares will be exhibited at a price of $ 15.28.

Imagine yourself a happy developer of cryptocurrency. You have invented a new function and now you want to test it in real conditions. You cannot dodge everything and throw it into the market (your project is extremely important for you), but you cannot protest the new “feature” without real users. What to do?
You want your cryptocurrency to get this function (and people would use it) and at the same time doubt it, because in case of a critical error, people will lose their money.

Alternative 1

  • Is the creation of an altcoin with its own blockade (something like a testnet for the main project).
  • Counter-argument: this alternative project will be forcibly discontinued if successful, so as not to become a competitor of the main currency (which, as we remember, should eventually include a new function). In any case, users will have somewhere to put these altcoins.

Alternative 2

  • The idea is that you can start parallel blocking with experimental features, in which there will be no coins (for now). The user can “block” coins in the main block (by sending them on a special address-script), and the same number of coins appear in a parallel chain.
  • Naturally, we are talking about the same coins available to the user. The elegance of this concept is that the second block should not contain the core: for the release of N-altcoins, the user should only provide concise evidence of the fact that the N-altcoins were blocked in the main chain. After that, he can use them inside the second locker with all the available functions.

How to return a coin back?

  • In the same way! Hence the “2-way pegging”. The user must block coins in the test chain, and they will be unlocked in the main. The ratio for such transitions is always 1: 1, so the total number of coins in the two chains will be constant.
  • Thus, the exchange rate and other buying criteria will not change. Technically, these are the same coins, only now they have branches in the second block.
  • If something happens to them, in connection with their experimental nature, the coins will simply fall back into the main chain. And if you decide to implement the tested function in the main circuit, there will simply not be an alternative circuit (until you again need to test another revolutionary function).

What is a Pegged Cryptocurrency? This is an asset linked to another currency or commodity, which always has 100% or more value supported by the base currency, in most cases this currency is the dollar.

 



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