CryptoTicker.io interviewed founder of Augmint Peter Petrovics at C3 Crypto Conference Berlin to hash out the major distinction between their Crypto-Collateralized stable coin and Tether.
“The Augmint Project is a free association of stakeholder individuals, groups, and organizations who have made common cause to create and maintain an open, decentralised, and distributed ledger based stable cryptocurrency system.”
It is focused on stability to the Euro. The Augmint system for achieving this goal is with five main processes.
Market mechanics – focuses on maintaining the best quantity of coins in circulation for stability
Diversified collateral – utilizes the ups and down of the market as a balance for the overall portfolio value
Loan parameters – creates higher or lower incentive to purchase the Augmint coins
Lock up premium – provides incentives to coin holders for keeping locking their coins to impact supply and demand of the market
Market intervention – As a last resort, a reserve pool is held at all times that can be accessed to regain balance between coins and collateral
What’s Wrong With Tether?
Controversy has surrounded the Tether coin. It was created as a Fiat-collateralized coin. In November 2017 organization claimed to have been hacked for a loss of $31 Million worth of the coin. There were also rumors in January 2018 that the company was audited by U.S. government for transparency concerns.
Initially reported a backing of $442.9 million by Freidman LLP – an accounting, tax and business consulting firm. That partnership has since ended. Tether has not announced definitive documentation of USD to back the amount of Tether coins that have been released. This completely debases the purpose of the coin.
A decentralized autonomous organization controls Augmint. This means that it is inherently impossible for something like an incongruity of coins and collateral to occur.