As central banks continue their monetary easing policies and turn on their money printing machines, the purchasing power of countries’ fiat currencies has steadily declined. This year, the CPI (Consumer Price Index) in the United States has reached a nearly 20-year high of 8.5%. According to the data, in terms of balance sheet, the U.S. has soared from $4.14 trillion at the beginning of 2020 to $7.33 trillion at the end of 2021, printing about $3.2 trillion; while in terms of M2 supply, it has soared from $15.3 trillion to $19.2 trillion. In a way, 20% of the dollars in circulation in the global marketplace today were printed in 2020. The massive printing of money and the massive over-issuance of money have led to more and more money in circulation on the market, naturally causing currency depreciation and inflation.
Therefore, the world needs a new stable currency more than ever.
You read that right, it’s not the crypto community, it’s the world that needs it.
We should know that the essential need of transaction is to exchange goods for goods, currency is just a transit/storage need when exchanging goods, it is more convenient, but in the face of inflation, it looks so poor. Suppose we have item A with a shelf life of one year, which can now be exchanged for item B with equal value. We don’t need item B now, but item A has a shelf life, so we have to exchange it into currency (say dollars) first. Ten years later, we need item B, but considering the 4% annual inflation, it is now worth 1.48 times of what it was then, while the dollar is still only 1.22 times even if we buy 10-year treasury bonds. We have more money in our hands, but we can only buy back 82% of the value of the item at that time, which is the power of inflation.
Like the example above, because of global inflation, we find that fiat money is not very stable relative to commodities, in terms of the property of being a medium of exchange for goods. We need currencies that have constant purchasing power over time, which is the true stable currency.
Now, we see teams moving toward that goal.
VOLT is a digital currency in the ETH network that achieves the goal of a truly stable currency by anchoring the purchasing power of the US dollar. For example, if VOLT was launched at the beginning of the month at $1 and inflation was 1% last month, VOLT would end the month at $1.01 and it would adjust monthly over time based on Consumer Price Index (CPI) data, which is powered by Chainlink. Like MakerDAO’s DAI, VOLT will be backed by a mix of user-deposited collateral and protocol-controlled assets, differing from DAI or other algorithmic stablecoins in that VOLT is anchored to truly stable purchasing power, rather than paper money printed at the whim of state agencies.
Volt is positioned to be exciting and, more importantly, a community project. Can you provide input on the distribution and use of dollars? In the Volt system, you can. Volt will ultimately be a project controlled by the DAO, where everyone involved can have an active voice to make it better, with a vote by the entire membership on whether the final proposal passes or not. For example, the project is now anchored to the US Consumer Price Index (CPI), but as a globalized project, in the future, if someone proposes to get a new mCPI by weighting and averaging the CPI of several internationally influential countries and anchoring VOLT to this mCPI, it will be a stable currency representing global purchasing power in the true sense. The project is not yet fully launched, but it has such a huge development potential waiting to be created. What could be cooler than to be involved in the operation of a system that will be the global currency of the future? It’s a thrill that no amount of money earned can bring.
VOLT is a currency that has not appeared in the existing financial system. Through the development of blockchain technology for more than a decade and the exploration of algorithmic stablecoins such as DAI and FEI pioneers, in line with the needs of the times, this stablecoin, which truly represents purchasing power, has finally emerged. It is foreseeable that, out of the habitual dollar pricing mindset, VOLT may go unnoticed in the short term after launching in the market, but with a development perspective, more and more people will surely be willing to hold such a stablecoin in the future.
When the first steam locomotive was introduced, some people drove wagons and raced trains, sneering at the fact that trains were not as fast as wagons, and those who sneer at trains today are sneered at by history. In the same way, few people today may see the value of VOLT and sneer at the use of such code from scratch compared to the dollar, but what about looking into the future?
VOLT whitepaper :https://github.com/volt-protocol/whitepaper/blob/main/volt.md
Website:https://www.voltprotocol.io/