Saga Monetary Technologies, the London firm behind global cryptocurrency SGA, has teamed up with keyless crypto wallet ZenGo. The new partnership means that SGA holders can safely store tokens on the non-custodial mobile wallet, which dispenses with private keys and instead favors a combination of biometrics and cryptography. The announcement is a timely one, with testing economic conditions intensifying interest in SGA as regular stablecoins lose their luster.
“Allowing users to hold SGA using ZenGo’s solution allows us to provide users with a safe and simple solution, while leaving the complex blockchain management infrastructure under the hood,” said Saga’s founder Ido Sadeh Man.
“We are excited to offer our customers the ability to take part in Saga’s vision of a reserve-backed, global and stabilized digital currency,” added ZenGo CEO Ouriel Ohayon. “Starting today, our customers will have access to a unique and innovative digital asset that we believe will power a new kind of financial ecosystem.”
Saga Interest Soars as Stablecoins Falter
While ZenGo is the first keyless crypto wallet, Saga is the first global stabilized digital currency controlled by its holders. But while most stablecoins are backed either by a single fiat currency – typically the dollar – or collateralized against cryptocurrency, SGA emulates the IMF’s special drawing rights (SDR), a basket of trusted fiat currencies known for its low volatility.
There has been a considerable buzz about Saga of late, perhaps a consequence of faltering collateralized stablecoins such as MakerDAO’s SAI. Last week, amid a mass crypto sell-off that wiped tens of billions off the industry’s market cap, the single-collateral SAI lost its peg to ETH as prices dropped double digits. The $4 million shortfall in Maker’s reserves highlighted the problem with crypto collateralized stablecoins in periods of immense turbulence, while fiat-backed stablecoins are not immune from issues either, since they’re only as stable as their peg.
Traders seeking a reliable store of value during volatile periods will have noted MakerDAO’s horror show with interest: while fiat-backed stablecoins like Tether managed to maintain their dollar peg, cascading liquidations left SAI – as well as collateral loans constructed using SAI and multi-collateral DAI – badly exposed, damaging the reputation of crypto-backed stablecoins in the process.
Stablecoin Volume Surges
Although fiat-backed stablecoins remain viable for many investors, with six stablecoins now among the top 50 crypto assets by market cap, stablecoins like USDT and USDC do not offer an optimum store of value while currencies like the dollar, Euro and British pound continue to struggle. Rather than relying on a single fiat currency, SGA is pegged to a basket of major currencies including the U.S. dollar, Euro, Japanese yen, pound sterling and the Chinese renminbi.
A cursory glance at SGA’s price proves that it has held up remarkably well amid turmoil on the markets. Indeed, its price was barely affected by the events of Black Thursday, which saw assets such as BTC and ETH lose almost 50% of their value.
Saga’s partnership with ZenGo will bring a highly stable cryptocurrency to a wallet that, by eschewing private keys, eliminates a single point of failure. As investors scour the market for stability and security, it might just prove a perfect match.