Damex App

New Partnership: Damex.io & Poundtoken.io – GBPT Stablecoin

Contents

Introduction

Damex.io is glad to announce a new collaboration with Poundtoken.io, the first British-Isles regulated stablecoin that is backed 100% and pegged by GBP British pound sterling. 

As part of the collaboration, Damex.io will offer customers the secure custody of Poundtoken (ticker: GBPT), as well as the ability to securely trade and transact the GBPT stablecoin. Poundtoken is not yet tradeable on the Damex.io app.

Stablecoins are a relatively new form of payment/exchange token that are typically asset-backed (by physical collateral, cash equivalents, or digital assets) or in the form of an algorithmic ‘stablecoin’ where reserving is automated. Stablecoins are sometimes referred to as currency tokens.

In addition to other benefits tied to each stablecoin project, these coins generally offer the benefits of cryptocurrency, namely speedy international transfers and low fees, without the drawback of volatility.

About Poundtoken – a stable, trustworthy and transparent stablecoin

Poundtoken (or GBPT) is designed with transparency and consumer confidence at its core and has an impressive and transparent means of ensuring that it is appropriately backed. Of a few points to consider, we have highlighted some important considerations that are declared by the GBPT issuer, Blackfridge SC Limited. Statements made below are taken from poundtoken.io’s documentation and shall be read with our Risk Notice prior to trading.

1. Backed 100% by GBP reserves

For every GBPT released into circulation, £1 is held in safeguarded accounts in a European Bank – i.e. the stablecoin is not algorithmic or backed by commercial paper. This way, holders can redeem their GBPT holdings 1:1 for GBP at any given time, and in the event of any adverse event, client funds are ring fenced and protected.

2. Commitment to consumer confidence

To further assure holders, KMPG has been appointed as the auditor of the stablecoin which makes it among the first crypto project to be audited monthly by a big 4 accountancy firm. Monthly assurance reports give holders of GBPT the peace of mind that their GBPT maintains its stable value.

As further validation of Poundtoken’s credibility, once realising that a lot can happen in a month, Poundtoken pro-actively sought a real-time proof of reserve to show at all times that the GBPT issuance was at all times matching what was held in safeguarded and segregated bank accounts. This feature is done using various on-chain verification oracles that interconnect with Poundtoken’s bank holding API. A neat proof of reserve feature on the poundtoken.io homepage allows holders to monitor cash holdings in real-time.

3. Importance on regulation

Blackfridge SC Limited, the pioneering fintech company and issuer of GBPT is regulated by the Isle of Man Financial Services Authority which is backed and licensed by competent British financial regulators. Blackfridge placed major importance on proper regulation, compliance and licensing with the Isle of Man Financial Services Authority before considering and proceeding with the GBPT launch.

Whilst we have carried out our own due diligence on GBPT and the issuance of GBPT, we do need to set out the risks of trading digital assets and the risks associated with trading with any stablecoin that is backed and/or reserved by a private entity, such as GBPT. We would suggest that you review our Risk Notice on our website www.damex.io/risk-notice to understand more. 

Trading stablecoins poses a number of unique risks including but not limited to the GBP ‘peg’ value of the GBPT becoming ‘de-pegged’. This can be caused by issues with reserving or liquidity issues of the issuer, Blackfridge SC Limited. Whilst we have taken steps to familiarise ourselves with the GBPT and the issuer, including taking legal opinions, whilst we consider these risks to be lower than other stablecoin projects you are still encouraged to undertake your own decisions with choosing what assets you may wish to trade. Clients are therefore encouraged to familiarise themselves with our risk notices and the risks associated with any asset traded with us.

Christian Walker, Head of Partnerships at Poundtoken commented:

“Let us assure clients that we regard poundtoken as the gold standard of international stablecoins, due to our strict regulatory requirements in the Isle of Man, our monthly auditing by KPMG, and our real-time proof of reserve with Chainlink. Consumer funds are always backed 100% with GBP in cash, meaning at any given time clients can offramp their GBPT for GBP with no risk attached. We are proud to be leading the way in on-chain utility, transparency & trust.”