Gemini has reportedly locked down six patents over the past year, the most recent one last month.
The most recent patent would enable banks to issue tokens, or stablecoins. Effectively, Gemini could create a reliable distribution network for its stablecoins. Banks could add them to their accounts, as well.
While there have been small efforts like itBit, we have yet to see the true rise of the crypto bank. Instead, we’ve got an array of payment processors and exchanges.
As a group, the patents are meant to show that Gemini’s stablecoin can be used in banking. Whether or not they’ll do the trick remains to be seen.
Gemini’s GUSD had a market capitalization of just $4.6 million at press time. Tether, by comparison, has billions.
Meanwhile, central banks have been considering their own ways of issuing digital currencies. In a world where most fiat currencies were digitized, would stablecoins even make sense anymore?
Why trust an issuer, when you can use the central bank? The only question, of course, is how these central bank digital currencies will launch by comparison to stablecoins.
Stablecoins are relatively easy to access, and easy enough to cash out. Will CBDCs be launched on blockchains, or will they be something new altogether? Will you be carrying around digital cash in your phone, at that point? So many questions, and no answers forthcoming at this time.
Digital cash on your phone is essentially the goal of many cryptocurrencies. With Bitcoin Cash, it’s in the name. Dash aims to be Digital Cash. And so on. If central banks offer such services, it becomes a question of who’s doing it better.
But in the case of Bitcoin itself, it might not matter much. People will likely hold that one no matter what, but others, that are meant for spending, might get outmoded with a digital cash from, for example, the Federal Reserve.
CBDCs will differ from both cryptocurrencies and existing ways to virtualize money in that they will be actual cash that is digital. We don’t have that today, except in the form of Bitcoin and other cryptocurrencies. Thus, central banks will have to do it in such a way that it mimics Bitcoin and other cryptocurrencies.
Will people’s name and a number, or something, be used as their address in this new scheme? Will banks be responsible for some part of issuing out the new wallets?
Stablecoins like Gemini will be given a run for their money if, for example, the Federal Reserve decided to launch a digital version of the dollar. People would immediately see the utility in that, but they still wouldn’t necessarily make the jump to get into stablecoins.
The role of stablecoins at that point might be as a crossover between blockchains. Tether, for example, is available across three chains. Getting on more blockchains might become the goal of various stablecoins moving forward. It’s something that the CBDC wouldn’t necessarily care about. Stablecoins could therefore be the means to move fiat quickly between blockchains.