[NEWS] Progma collaborates with DataChain on stablecoin and announces successful transfer transaction between multiple blockchains

On the 31st, Progmat, Inc. and Datachain announced that they will collaborate to provide stablecoins issued using the stablecoin issuance and management platform "Progmat Coin" and to maximize AUM (assets under management).

In addition to the conventional multi-chain and cross-chain deployment, the two companies will collaborate to promote stablecoin contract development and business deployment in the global market.

Smart contract development for stablecoin standard functions has already been completed, and stablecoin transfer between multiple blockchains has been successful in the testnet environment.

Going forward, the two companies will strengthen their collaboration to globally standardize stablecoins issued using Progmat Coin, including creating international use cases.

Stablecoin market size behind the collaboration

As the background to the collaboration, the two companies cite that the global stablecoin market has currently expanded to a size of over 160 billion dollars (approximately 25 trillion yen). In addition, stablecoins are not only being used in services developed on the blockchain, but various use cases are being considered, such as improving the convenience of retail payments and payments between corporations.

On the other hand, existing stablecoins have issues such as compliance with regulations and price instability, and it is pointed out that safe and secure stablecoins issued by internationally trusted financial institutions that comply with regulations are required.

In Japan, stablecoins were legally defined by the revised Payment Services Act that came into effect in June last year. Currently, companies are preparing to issue stablecoins that comply with the law.

On top of that, efforts are currently being made to issue stablecoins using ProgmaCoin. In the future, as soon as preparations such as obtaining licenses are complete, stablecoins backed by major legal currencies such as the Japanese yen and the US dollar are expected to be issued through ProgmaCoin.

Successful transfer transactions between multiple blockchains

The purpose of this initiative is to maximize the AUM of stablecoins issued using ProgmaCoin by Progma and Datachain.

Regarding smart contract development, standard functions such as stablecoin registration, issuance, and transfer have already been completed, and it has been confirmed that transfer transactions between different blockchains are executed normally in the testnet environment of public chains such as Ethereum and BNB Chain.

▶︎Image of cross-chain transfer reference: Press release

The transfer transaction uses the "Burn-Mint method". This is a method in which one blockchain is burned and the same amount is minted on the other chain. The two companies say that it is more capital efficient and convenient for users than the conventional main methods.

At present, this method has not been realized except for USD Coin (USDC) issued by Circle in the United States. Therefore, they explain that it is expected to be the only stablecoin that can realize Burn-Mint cross-chain transfer from the time of the system release of the Progmacoin platform.

In addition, stablecoins issued using Progmacoin implement the Burn-Mint method using IBC, a communication protocol between blockchains developed by Datachain. This will enable the provision of capital-efficient transfer functions between blockchains in a secure and versatile format.

Going forward, the two companies will work with stablecoin issuers such as trust banks to develop and discuss additional functions to issue stablecoins using the Progma Coin platform and maximize AUM thereafter.

Reference: Press release
Image: Shutterstock

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