Imagine being able to launch your own stablecoin with just a few simple commands. The Komodo blockchain is aiming to make this a reality. As a multi-chain blockchain platform, Komodo, also referred to as a “composable Smart Chain platform,” allows users to build their own customizable blockchains, known as Komodo Smart Chains. Recently, the platform introduced new beta features in their test net, enabling the creation of stablecoins backed by Bitcoin protocol-based cryptocurrencies.
Komodo is described as a “composable platform” because it empowers users to construct their own independent blockchains using the Antara Framework. This framework allows for notarization to the Bitcoin network, enhancing security, while also offering extensive customization through Komodo’s modular system.
With some coding knowledge, anyone can develop their own Bitcoin protocol-based cryptocurrencies via Komodo’s Antara composer, a user-friendly web application for blockchain creation. Currently in alpha testing, the “Prices” and “Pegs” features will soon facilitate the creation of stablecoins and cryptocurrencies linked to various assets, including stocks and commodities. The Prices Module will monitor real-world asset prices, supplying metadata to the Komodo Smart Chain. Meanwhile, the Pegs Module, crafted by the Komodo team, will leverage this metadata on the blockchain, allowing users to lock Bitcoin-protocol funds with the Pegs Module and withdraw up to 90% of the fund’s value in the form of stablecoins. This stablecoin can then be traded with others on the network using atomic swaps, a technology that enables users to exchange cryptocurrencies without relying on centralized exchanges.
All stablecoins created on a Komodo Smart Chain can be listed on the platform’s native decentralized exchange, AtomicDEX. “If you wanted to create a chain, you could do that right now, alone at your computer, without any external support, without any funds—without anything—and you can just like spin up your own blockchain,” explained Komodo CTO Kadan Stadelmann, highlighting the ease of the platform’s smart chain functionality. “This blockchain would literally inherit all of Komodo’s technologies and features—every wallet, every dapp, every system that we brought out for Komodo is automatically compatible with your smart chain.”
Komodo’s stablecoin capabilities could enable users to develop stablecoins backed by Bitcoin, as well as Komodo’s native cryptocurrency, KMD, and anchor them to the Bitcoin network for added security. “Anyone can spin up and use a smart chain and stablecoin,” Stadelmann stated, emphasizing his expertise in programming languages like C++ and his advocacy for Rust, a language developed by Mozilla. The process for creating a stablecoin on a Komodo smart chain will be entirely blockchain-based and decentralized.
“There is full transparency,” Stadelmann affirmed. “The biggest problem with [certain] stablecoins is the lack of transparency. We believe that our technology, and the way that we implemented the stablecoin module, provides 100% transparency.” Built on a fork of Bitcoin technology known as Zcash, Komodo is currently in discussions with financial partners interested in the ability to swiftly and securely create their own stablecoins. “This feature would allow financial firms and investment firms to spin up a stablecoin within minutes,” Stadelmann noted. “So you literally have a stablecoin for specific projects, for specific use cases, for specific products, for specific trading engines.” Third parties issuing stablecoins on Komodo can determine the amount they wish to create and set additional parameters.
There are various reasons to establish a stablecoin. For instance, a project may need to manage its cryptocurrency funds effectively. “Take a part of your project funds that you have in crypto and transfer it over into a stablecoin,” he suggested. “Let’s say, I want to pay salaries to my team. This stablecoin would allow me to be much more precise.” Utilizing a stablecoin eliminates reliance on the fluctuations of the crypto market. The Komodo chain will capture information from a third-party stablecoin chain and store it on the Komodo blockchain. “We then take the Komodo block, which already contains your stablecoin information, and store it into the Bitcoin blockchain,” Stadelmann explained. “Technically speaking, it even gives you a slightly higher security level than Komodo itself. Because if a hacker really wanted to attack your stablecoin chain, he would have to first attack Bitcoin. Afterwards, he’d have to hack Komodo, and only then would he be able to attack your stablecoin.”
Stadelmann is optimistic about the potential applications of blockchain and stablecoin technology. “If you are from the fintech sector, you could basically build up a derivative trading platform in a decentralized fashion,” he remarked. “Blockchain tech is melding with the traditional financial sector. Everything that we see, all these tools, all these financial products in the traditional financial markets can somehow be attached to the blockchain world.” He also noted that stablecoins are playing a crucial role in bringing blockchain technology into the mainstream. “People now realize that this is money that we were talking about,” he stated. “Most centralized exchanges didn’t have any fiat relation one to two years ago. When you’d log into an exchange, you just have all these crypto pairs. Someone who is not into this space, not into this stack, would just see ‘BTC-KMD’ pair or an ‘LTC-ETH’ pair. But, now we have these stablecoin pairs, and it gives people that weren’t in the space a feeling that this is real money. There are USD pairs now. It’s stuff that hasn’t been here before.”
