While Stablecoins revolutionized decentralized finance (DeFi) by digitizing real-world currencies, they still grapple with inflationary pressures akin to their fiat counterparts. 

However, the emergence of flat coins, like the International Stable Currency (ISC), presents a game-changing solution. With flatcoins, investors can now effectively hedge against inflation without the complexities of active portfolio management.

In this article, we’ll look at what flatcoins are all about, why they matter, and what they could mean for how we handle money in the future.

The need for a flatcoin

The first wave of stablecoins served an important role by providing crypto holders a store of value. Simply put: users can swap their volatile assets for stablecoins to capture the upside of a trade and take profits.

But there’s still a major problem: once you swap for a stablecoin you’re up against the inflation rate of whatever fiat currency the stablecoin is backed by. 

The solution to this problem is flatcoins. Flatcoins are cryptocurrencies backed by a diverse basket of assets that appreciate over time. The flatcoin name stems from the “flatness” it maintains against the on-chain basket of goods that back it. Although stablecoins like USDC are also backed by yield-bearing assets, they do not increase the stablecoin’s value like flatcoins do.

Flatcoins not only stand to serve current crypto users but are a great way to onboard retail investors seeking a “set it and forget it” solution to beat inflation. For example, International Stable Currency (ISC) a flatcoin on Solana has outperformed some of the top fiat currencies globally:

Introducing International Stable Currency (ISC)

International Stable Currency (ISC) is Solana’s first and only flatcoin and is pegged to the value of an underlying basket of commodities, bonds, and equity. 

By directing the returns generated from its reserves back into its token’s value International Stable Currency (ISC) presents a stablecoin designed to grow in value over time.

ISC’s current basket of reserve assets includes:

• VWRA (Vanguard FTSE All-World UCITS ETF USD Acc)
• IB01 (iShares $ Treasury Bond 0-1yr UCITS ETF USD A)
• AGGU (iShares Core Gl Aggregate Bd UCITS ETF USD Hgd Acc)
• SGLD (Invesco Physical Gold ETC Fund)
• USD (United States Dollar)

To date, ISCs basket of collateral has helped the asset grow significantly. For instance, over the past 180 days, ISC value increased by 4.45%, growing from $1.57 to $1.64. This equates to a ~8.9% yearly APR.

Comparatively, stablecoins, along with the US Dollar lost ~1.45% in purchasing power due to inflation. 

How does ISC work?

Under the hood, ISC consists of four key entities that work together to maintain the supply:

• ISC Issuer: The ISC Issuer is responsible for issuing and recalling ISC Loans to the ISC Reserves.
• ISC Reserve: Reserces provide liquidity of ISC to the Digital Asset Market (cryptocurrency market), while also buying and selling assets from the Real World Asset Market.
• Digital Asset Market (Cryptocurrency Market): The ISC Reserve ensures ongoing liquidity within the digital asset market for ISC by facilitating the purchase and sale of ISC as required.
• Real World Asset Market: Assets are bought and sold from the Real World Asset Market to implement the ISC Reserve Basket for each ISC in circulation –maintaining the ISC Target Price. 

ISC Community Governance

ISC invites its community to help shape the direction of the asset, rather than being controlled by a government or a small centralized group. The community consists of the ISC Council and the INTL DAO which collaborate to decide on matters concerning ISC, such as adjustments to its collateral.

The ISC council comprises experts and members of the ISC team and is responsible for drafting and proposing initiatives to the ISC DAO. 

On the other hand, the INTL DAO, represented by holders of the $INTL token, retains the power to veto any proposal put forward by the Council. This mechanism ensures that the Council’s decisions align with the broader community’s interests and the process remains democratic.

Solana: The hub for Stablecoins

Since December 2023, Solana has led the way among blockchains in stablecoin transfer volume thanks to the network’s high throughput and sub-1 cent network fees. Most recently, in January Solana accounted for ~33% of total DeFi stablecoin transfer volume.

With the launch of ISC, Solana now has a native flatcoin allowing users to transfer and hold an inflation-resistant asset. 

This will open up many opportunities which include the ability for Solana teams to incorporate ISC into their treasury holdings.

Furthermore, for emerging countries, flat coins like ISC provide a permissionless solution that anyone with a cryptocurrency wallet can access. 

Conclusion

International Stable Currency (ISC) is providing a modern-day solution to the age-old problem of inflation. With ISC, people no longer have to manually invest in index funds or lament about how much their dollars were worth 20 years ago.

Furthermore, ISC’s strategic choice to launch on Solana will prove to benefit both parties in the future. Solana users get access to an inflation-resistant community-run asset, and ISC can leverage the blockchain with the highest stablecoin transfer volume.