Holders of Moneda tokens will have the option of having them redeemed directly from Monetran.
Making Moneda redeemable accomplishes a couple of important things.
First, it provides liquidity. Moneda holders will never have to worry if there will be a buyer for their tokens.
Second, it promotes stability of token price. Because Moneda tokens will be redeemed at a certain price which is determined by the principal in the asset account, those who buy and sell on the exchanges will have a built-in reference of what the approximate market price should be. Because token holders will have the option of redeeming their tokens with Monetran, there should be no significant difference in price between the open market and the redemption price, although tokens traded on the open market should be slightly higher due to the likelihood that future increases will be factored in.
Tokens redeemed through Monetran will incur a 1% redemption fee, of which half will be deposited into the asset account to help it grow and half will go toward operating expenses.
As the principal in the asset account increases, so will the redemption price for Moneda tokens. As the redemption price rises, the market price should remain slightly ahead.
Stability of price is a necessary element for a token to be accepted for everyday use in commerce. It is likely that the better known cryptocurrencies, such as Bitcoin and Ethereum, will never be stable enough to fill that role. That is because there is no mechanism that either of them can employ to have a stabilizing effect on their respective currencies. Price stability is one of the central tenets of Moneda and a compelling reason to believe that the token can serve as a universal currency for internet commerce.
It is worth noting that not since the days of the gold standard – nearly a half century ago – has a currency been backed by anything of tangible value. It is one of the objectives of Monetran to bring back the honor and the promise that governments, including the United States, once gave those who trusted their currencies.