Goldman Sachs Powers BitGo's Entry Into Stablecoin Market

Goldman Sachs Fuels BitGo’s USDS Rewarding Stablecoin Ecosystem

BitGo, a cryptocurrency custodian backed by Goldman Sachs, has officially announced the launch of its new stablecoin, USDS, scheduled for release in January 2025. This stablecoin is pegged to the US dollar and backed by a mix of short-term Treasury Bills, overnight repos, and cash. The main goal of USDS is to challenge established stablecoins like Tether (USDT) and Circle’s USDC while introducing a new model that rewards participants for supporting the network by providing liquidity.

Goldman Sachs: 98% of Earnings Distributed to Network Supporters

One of the standout features of USDS is its reward system, which gives up to 98% of earnings to participants who contribute to the network. Unlike traditional stablecoins where the interest generated from reserves typically goes to the issuer or exchanges, BitGo aims to ensure that a majority of the earnings benefit institutions, exchanges, liquidity providers, and users. This innovative approach encourages more involvement in the ecosystem, fostering a balanced and inclusive financial environment.

Eligibility for USDS Rewards

To be eligible for the rewards, participants need to register with BitGo and provide proof of ownership of their USDS holdings. BitGo calculates rewards based on the amount of USDS held, with different compensation tiers based on liquidity levels. Rewards will be distributed monthly, and the distribution revenue share (DRS) will be determined after deducting BitGo’s monthly administration fee. This system is designed to ensure fair and transparent reward distribution for all network participants.

Minting and Burning USDS with No Fees

BitGo also offers a seamless minting and burning process for USDS. Qualified users can mint or burn USDS using USD, USDT, or USDC without incurring any fees, as BitGo covers the costs. By offering these incentives, BitGo aims to attract a wider range of users while maintaining neutrality in the market, focusing on promoting growth and adoption of the entire stablecoin ecosystem rather than competing directly with other exchanges or issuers.

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