Singapore-based Huobi Global has hopped onboard the stablecoin bandwagon by launching what it calls an all-in-one “stablecoin solution.” Dubbed HUSD, this new offering by the world’s third-largest crypto exchange enables traders to convert between four different USD-pegged stablecoins listed on its platform.
What Makes HUSD Different From Other Stablecoins?
Huobi explained in a press release dated Oct 19 that the HUSD solution is designed to help traders get rid of the need to choose between different stablecoins. Apart from that, it is also being coined as a big stride forward to reduce the transaction cost of converting between different stablecoins and removes the risks associated with holding one single stablecoin.
Initially, the HUSD solution will be compatible with four USD-pegged stablecoins listed by the exchange. These are Paxos Standard (PAX), True USD (TUSD), USD Coin (USDC), and Gemini Dollars (GUSD).
To put it simply, whenever a Huobi user deposits a stablecoin in their account, it will be displayed as HUSD. The user will have the option to withdraw the HUSD in their account to any other stablecoin of their choice during withdrawal. Huobi explained:
“For example, when you deposit 1 PAX, it will show as 1 HUSD in your account, and you can withdraw 1 TUSD (not considering transaction fees on the blockchain).”
Benefits of the HUSD
Huobi claims the HUSD solution brings three distinctive benefits on the table for traders using its platform.
- It claims that besides being safer and convenient, HUSD is capable of mitigating the drawbacks of holding stablecoins.
- HUSD will further add to the stability of stablecoins by providing a safety cushion for investors. Since Huobi will take it upon itself to ensure a more stable store of value for investors’ deposits, they can expect better protection against the asset class.
- Huobi users won’t have to worry about incurring additional transaction costs while converting between stablecoins.
While this new feature is currently limited to only four USD-pegged stablecoins, the exchange said it is committed to integrating more coins into the HUSD system.
“We look forward to more stablecoins being involved in the HUSD system. Concurrently, we will evaluate the existing stablecoins in the HUSD system on a real-time basis, if the stablecoin doesn’t meet the corresponding risk control standard, we will remove it off from the HUSD system.”
How impactful the new HUSD system proves to be in the long run remains to be seen. However, there is no denying that Huobi’s new offering is indeed a first-of-its-kind and it brings something new and exciting for stablecoin proponents to cheer for.