The concept of so-called stablecoins, from the inception of Tether to the recent surge in activity in this direction, which resulted in the birth of a number of new stablecoins, has attracted more and more attention of the cryptocurrency community. Given the volatility of the market, such attention is understandable – stablecoins really give traders a good tool for hedging risks and, accordingly, preserving the value of assets.
Parallel Protocol is is a decentralized stablecoin issuance protocol based on the Ethereum blockchain.
Parallel Protocol offers a stablecoin called PAR, which is backed by fiat currency like EUR, not USD, like many other stablecoins. Thus PAR became the first decentralized EUR stablecoin.
The tokens kept stable by collateral locked in a smart contract vault. All vaults in the Parallel Protocol covered by an insurance fund.
We should note that there are no counterparties in this exchange, as actors in the network transact directly with the PAR smart contracts.
The Parallel Protocol project not only offers a fundamentally different stablecoin model, but in the future it’s able to create that very decentralized alternative to institutional projects that would correspond to the true spirit of the “open Internet”. Soon, holders of the PAR governance token will be able to vote on-chain on the ongoing operations and upgrades to the Parallel Protocol.
Objectives and features of the Parallel Protocol project
The project’s objective is to create stability in the world of decentralized things. This stability realized through PAR. It’s an ERC-20 standard token, which allows to use it in all the most popular Ethereum wallets.
However, the main feature of the Parallel Protocol is that the platform uses two tokens. In addition to the PAR stablecoin, it is also MIMO governance token. MIMO governance token acts as a kind of “fuel”. MIMO governance tokens distributed to users of the protocol. For both creating PAR through borrowing and for providing liquidity in AMM pools. This token distribution guarantees that the protocol stewardship remains with the users and the community of the Parallel Protocol.
After the commission is paid, MIMO tokens are “burned”, thus supporting the demand. That is, it guarantees that there will never be more than 1,000,000,000 MIMO tokens.
In addition, MIMO governance token performs a management function. The token used to vote for such a key aspect of the survival and functioning of a project as risk management, as well as the platform’s business logic. Every MIMO governance token holder has the right to vote and the ability to create a new proposal.
Thus, Parallel Protocol is gradually decentralizing itself.
The Parallel Protocol system demonstrates dynamic development. PAR token traded on centralized and decentralized exchanges. We can say that today Parallel Protocol is one of the most successful decentralized autonomous organizations on Ethereum.
The success of Parallel Protocol is a testament not only to the innovation that the community is driving, but also to the flexibility and functionality of the Ethereum platform itself.
In addition, we should note that the topic of decentralized systems will not lose its relevance in the near future, but will only gain momentum. Cautious investors are switching to stablecoins en masse. Since, during periods of uncertainty and volatility, investors and traders seek to protect their capital and hedge risks.
PAR stablecoins automatically issued by smart contract. At the same time, any user can independently check that the amount of collateral on the contract really corresponds to the number of stablecoins in circulation. This is the best proof of the reliability of the token.
Other benefits of PAR stablecoins:
– easy to understand;
– one hundred percent stability;
– low susceptibility to vulnerabilities and risks of hacker attacks on the network.
This fully suggests that Parallel Protocol has already created its niche. Moreover, as PAR more widely adopted, it will only expand, creating new opportunities for the project.