open.coins question?

[pstrident]

are open.coins collateral backed on the blockchain?

its been said open.coins are similar to other exchanges, just iou tokens. is it that simple or is there some bts blockchain collateral backing the tokens?

Comments

[blocktrades]

open.assets are IOUs backed by OpenLedger, they are not backed by BTS collateral. The coins called "Smartcoins" are the blockchain-level assets backed by BTS collateral (e.g. BitUSD, BitCNY, etc). Despite this, there are several advantages to trading open.assets compared to trading on a centralized exchange:

1. the market itself is decentralized and is therefore not subject to potential manipulation and front-running by an exchange owner
2. you can trade between IOUs and Smartcoins offered by different companies and individuals (anyone can create a new market between their own coin type and coins offered by others)

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