Crypto and Payments Firm MobileCoin Launches New Stablecoin – ‘Electronic Dollars’

Privacy-focused cryptocurrency and payments firm MobileCoin, in collaboration with stablecoin platform Reserve, has launched a new stablecoin dubbed “Electronic Dollars” (eUSD). The company says eUSD is fully collateralized and is uniquely designed to protect users’ private transactional data.

According to MobileCoin, eUSD is backed by a basket of other stablecoins, namely, USD Coin (USDC), Pax Dollar (USDP) and TrueUSD (TUSD). Each transaction is said to be encrypted using end-to-end zero-knowledge encryption. In other words, only the transacting parties can see their own transactional data, thanks to encryption that uses zero knowledge proofs (a way of proving something without revealing sensitive information).

Read more: What Is a Stablecoin?

The stablecoin eUSD is built on the MobileCoin blockchain, which, according to MobileCoin, is optimized for mobile devices. Apparently, MobileCoin was originally designed for integration with encrypted mobile messaging app, Signal. Consequently, eUSD will inherit the features of MobileCoin’s native cryptocurrency, MOB, although eUSD users will pay transaction fees (a flat $0.0026 per transaction) in eUSD and not MOB.

“To our knowledge, no project has created a native stablecoin with privacy properties, which is a first-class citizen in the ecosystem, and which never requires the use of ‘non-private’ transaction technologies to use normally. In short, no one has yet actually created a private digital dollar,” MobileCoin stated in the eUSD whitepaper.

How does eUSD work?

The eUSD relies on what seems to be a centralized governance structure where the MobileCoin Foundation acts as the primary governing body. The foundation elects “governors” who are authorized to mint and burn eUSD.

The stablecoin’s collateral is held in a popular Ethereum multisignature (multisig) wallet called Safe (formerly “Gnosis Safe”). New eUSD is only minted after governors confirm an equivalent amount of collateral has been transferred to the Safe wallet.

“Anybody can inspect the contract holding this basket [of collateral], to see what the current balances are. It's a Gnosis safe, which is also one of the most highly regarded contracts on Ethereum for holding assets,” Henry Holtzman, MobileCoin’s Chief Innovation Officer explained during an interview with CoinDesk.

Read more: Gnosis Safe Rebrands as Safe, Raises $100M

Similarly, if a user redeems eUSD, the token is “verifiably burned” and governors release the corresponding collateral. Verifiable burning is when burned eUSD is sent to a “burn address” which renders it “visible” for transparency purposes, “but unspendable.”

However, everyday users won’t typically engage in burning and minting. An individual seeking eUSD would simply purchase it on an exchange. Approved liquidity providers (LPs) would be the ones minting large amounts of eUSD.

“Individuals have a much simpler experience than liquidity providers. Liquidity providers are creating Electronic Dollars in bulk and individuals are just buying them on an exchange,” Joshua Goldbard, CEO and founder of MobileCoin, told CoinDesk.


Many asset-backed stablecoin issuers recruit third-party accounting firms to produce attestation reports confirming the existence of assets matching the stablecoin’s circulating supply. MobileCoin uses a “reserve-auditor” program that performs a similar function.

“We're also standing up an auditor that will let you see for yourself all the wrapping and unwrapping events, and see that the total supply is the same on both blockchains,” Holtzman said.

The reserve auditor connects to the Safe wallet via an application programming interface (API) and verifies that each newly minted eUSD has a corresponding amount of collateral in the wallet.

“We'll release it all open source. So if you want to run your own copy [of the reserve auditor], you can. You can examine it to make sure we really are backed exactly as we claim,” Holtzman told CoinDesk.

Collateralized Asset Bridge

Since eUSD is backed by assets that exist on other blockchains, a bridge connecting MobileCoin to those other blockchains is required. The eUSD collateral is held in Safe, which is an Ethereum smart contract. Therefore, a bridge between MobileCoin and Ethereum is required to move “wrapped” versions of eUSD between the two blockchains. Wrapped tokens are synthetic (or tokenized) versions of crypto assets that are not native to the blockchains they exist on.

Governors approve liquidity providers and bridge operators to wrap and unwrap eUSD as it goes back and forth between the MobileCoin and Ethereum blockchains.

“Every wrap and every unwrap has to be signed by two partners. One of them is the person who is doing the wrapping and unwrapping, [that would be] the financial institution, and the other one is the bridge operator. And so together that way, the bridge operator can't steal, and the liquidity provider can't steal,” Holtzman explained to CoinDesk.

Know-your-customer (KYC) and anti-money laundering (AML)

Although eUSD relies on end-to-end zero knowledge proof encryption to keep transactions private, KYC and AML requirements are said to be in place at all on- and off-ramps.

“All of the on-ramps and off-ramps have full KYC and AML. The place where you have privacy is within the network, peer-to-peer,” Goldbard explained. “I think the biggest thing that we would love for you to take away from this conversation today is that we're building a data-protecting cryptocurrency that also complies with the law.”

Read more: MobileCoin Raises $66M to Build Out Privacy-Focused Payments Tech