The stablecoin payment application Reserve helps individuals protect their savings from inflation in Latin America

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Reserve is a popular cryptocurrency-based payment application that is gaining popularity in Latin America.The platform is a convenient way for people to convert local currencies that may be at high inflation levels into U.S. dollars through reserves Stablecoin (RSV). The network also has a retention token (RSR) for protocol governance.

Because of its Launched in March The platform said that by 2021, the total number of registrations has reached 367,000. At the same time, the number of weekly active users has exceeded 100,000, most of which are located in Argentina, Venezuela and Colombia. In the past 30 days, the application processed approximately 547,000 transactions. In addition, more than 8,000 companies mainly located in Venezuela now accept Reserve as a payment method for goods and services.

In a live demonstration of Cointelegraph’s Reserve app, Reserve CEO Nevin Freeman withdrew U.S. dollars from a U.S. dollar bank account to a Venezuelan Bolivar bank account, with RSV acting as an intermediary. Transactions are almost instant, and the application does not charge any fees. Freeman claims that users can use Bolivar immediately, such as online transactions, or swiping debit/credit cards to use cash. However, liquidity providers reviewed by Reserve charge spreads for initial foreign exchange transactions. The following is a complete interview between Cointelegraph, Freeman, and Reserve community manager Yens Michiels.

United Telegram: With the rise of the blockchain industry, there are many crypto-to-crypto and crypto-to-fiat payment solutions. In your opinion, what makes the Reserve agreement different?

Nevin Freeman: The Reserve app is a cloud-hosted stablecoin wallet. We hold cryptocurrency in the background, and users conduct transactions on our database.In the future, we will switch to users for on-chain transactions, but due to [high] Ethereum gasoline fee, this is the only way we provide this use case in countries such as Venezuela. In answering your question about the differences, it is to be able to use all these different currencies for deposits and withdrawals.The top five [options in the app] Different methods of deposit or withdrawal in Venezuelan banks; Argentine pesos, Panamanian dollars, PayPal, Zelle, Uphold, Colombian pesos, our tokens [RSV] On the chain, and a series of other cryptocurrency options that people use. We also recently added the Axie Infinity token because many people in Venezuela are playing Axie Infinity. Therefore, it is an easy way to exchange this money into U.S. dollars.

CT: How does the Reserve app help customers in the aforementioned countries/regions resist inflation?

NF: It is a very common practice for Reserve app users to get paid and convert their money into our USD stablecoin so that they don’t have to worry about the devaluation of their money. Then, throughout the week or month, they will regularly exchange small transactions back to the local currency to trade with the local economy. Then, as the number of merchants continues to increase, we are seeing more and more transactions that people don’t have to switch back; they can pay directly in USD stablecoins.

So this is not real rocket science. The concept is very basic.It’s like saving money in US dollars and living in US dollars. This is what many people want to do, but the changes here are being realized. [task] Easier to do and easier to obtain.

Let me add a more interesting point here: For example, in Venezuela, many transactions are conducted through Zelle, which is like the way the Bank of America quickly remits money between U.S. bank accounts. 1% of people in Venezuela have a U.S. bank account, and they have a lot of money in their U.S. bank account. So there are many transactions going back and forth with Zelle. Therefore, everyone in Venezuela wants to have a Zelle account. The problem is that unless you fly to the United States and actually create an account in the United States, you cannot get a Zelle account. Many Venezuelans have no chance to do this. So many of our users think about this service like, oh, it’s like a Zelle account, but anyone can open one, so that’s part of the appeal.

CT: So far, we have mainly discussed RSV and fiat currencies. But what about RSR tokens? What development plan do you have in this regard?

NF: The main function of Reserve Rights tokens is governance. The basket that supports any R token, which is what we call the Reserve stablecoin, must evolve over time. In the long run, you need a very safe and robust method to deal with this evolution in a decentralized manner. Therefore, RSR plays a key role in governance. Another major role played by RSR is to provide insurance. Some reserve stablecoins. The basic mechanism, economics, and purpose of how all this works remain the same, but the exact mechanism of how RSR provides this insurance has undergone some changes in our upcoming version of the agreement.

The way all this works is that as an RSR holder, you can choose any Reserve stablecoin or a combination of them to pledge your RSR tokens. When I say equity, I really mean equity; you actually put them at risk. Because what you are doing is, you said, well, if any collateral assets that support the Reserve stablecoin default and lose value, I am willing to provide my funds as support. In exchange for investing my capital and taking risks, I will receive a portion of the income or income generated by the stablecoin.

It is indeed a decentralized insurance method, and many of the blockchain protocols require token holders to vote and decide how they want to pay; in this case, it does not work like this. In fact, there is an on-chain mechanism. In the event of a depreciation, the token is replaced by another token, and the mortgaged reserve token will be automatically seized and traded to make up for the value. So it is indeed a more decentralized version of blockchain insurance.

CT: Do you want to include a vision or mission statement about the future of the Reserve Agreement?

Yen Michels: What we are doing now is to provide a solution to hyperinflation through the US dollar stablecoin. However, in the long run, we believe that the dollar may also depreciate partly. Because when you look at the history of currency, every time a major empire issues currency and loses power, or grants that power to the next empire, the currency loses a lot of value. So now, I think we provide solutions for these countries such as Venezuela and Argentina, because we have a strong dollar stablecoin that can help them get rid of hyperinflation. But you can also think about what will happen if the dollar, the currency we rely on, depreciates. Then no one can turn to escape currency.

Therefore, the long-term vision is to create a currency that is stronger than any fiat currency that currently exists. In our vision, this currency is obviously a cryptocurrency, and it will be supported by more than 50 assets on the chain, from digital currencies, and possibly even the initial legal tender, to commodities such as gold, and even stocks. So this will be a huge basket. In the end, the idea is that the value of the basket will follow the global GDP [Gross Domestic Product]. If you look at the global GDP, you will find that it is very stable; even during the 2008 financial crisis, it only fell by 2%. If you can create a currency that is as stable as global GDP, it will be better than any fiat currency that currently exists.We are now focusing on this issue step by step, but obviously it will take several years [to accomplish].