Price volatility has always been one of the main reasons why some people stray away from cryptocurrency investments. Blockchain startups have been trying to create stable cryptocurrencies to counter this. Swiss company Saga is the newest company to try it with $30 million in funding and a few unconventional methods.
The Swiss company aims to create the world’s first non-anonymous cryptocurrency but they believe in the necessity for balance between user privacy and regulatory compliance. Given this, they decided that know-your-customer (KYC) policies shall be implemented for every user.
To rid the cryptocurrency of price volatility, Saga has acquired backing by the International Monetary Fund’s Special Drawing Right (SDR) in its variable fractional reserve. These reserves are deposited in regulated banks using smart contracts.
What makes Saga unique?
Blockchain startups usually raise money for funding through initial coin offerings (ICOs), through token generation events, or through the latest startup trend, airdrops. Saga decided against these and chose a traditional funding route to raise funds. It involved accredited investors like Lightspeed Venture Partners and Mangrove Capital Partners among others.
The company also has some big names on their team as senior advisors, namely: Dr. Jacob Frenkel, Prof. Myron Scholes, and Prof. Dan Galai.
Dr. Frenkel expressed his belief in Saga’s vision in solving the current problems with cryptocurrencies:
“While blockchain technologies have gained growing acceptance, encryptic currencies have raised public policy concerns, since they are anonymous, unbacked, and are highly volatile…I share these concerns and see great value in Saga’s vision to address them properly.”
Prof. Scholes also exclaimed his support for Saga. Referring to blockchain technology, he says:
“This facilitates more efficient client solutions to their financial problems. The Saga project aims to develop a sustainable and efficient blockchain-based cryptocurrency that I support through becoming a member of its advisory council.”