Request Network and MakerDAO in Bid to Tackle Crypto-Fiat Volatility

Request Network and MakerDAO in Bid to Tackle Crypto-Fiat Volatility

The Request Network Foundation (REQ), a decentralised network for payment requests, has announced a strategic link-up with stablecoin producer MakerDAO .

This new partnership is seeking to offer developers who build dApps requiring an integrated crypto-to-fiat payment system to achieve price stability against the value of the U.S. Dollar.

“Natural Fit”

Both companies operate on the Ethereum blockchain and, when full ERC20 token support is officially integrated on the Request Network mainnet later this month, the MakerDAO token (Dai) will be among the first to be integrated into the Request Network platform.

While the Request Network has already partnered with several other companies this year, including Wikimedia, PwC France, Francophone Africa and gold asset tokenisation company Digix, this latest alignment with MakerDAO appears to be the most natural fit and gives their platform an extra dimension.

The Request Network already integrates the full range of fiat currencies in existence today, and is now seeking to remove the volatile fluctuations in price movement currently associated with cryptocurrencies in a bid to make digital currencies a more viable means of regular payment.

The Dai token value is kept stable, equivalent or close to $1, through a mechanism known as Collateralised Debt Positions (CDPs).

Whilst the two companies appear to compliment each others business goals, their respective origins are widely different. Request Network, currently priced at £0.27 per token, came to market last October and raised $33.6 million through a standard ICO.

MakerDAO, on the other hand, pre-dates the ICO phenomenon and did not run a public sale for their own tokens (MKR). They received instead an injection of funds from long term institutional investors in December, in a move that may have partly been motivated by a desire to avoid speculators disrupting its sensitive pricing mechanisms.

Currently, only a small percentage of the overall supply of MKR is available on select exchanges, priced at just over $1000 per token.