Stable Coin For HKD

The project aims to build a stablecoin for HKD and an app for using it in a shop.

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Introduction

In recent years, blockchain and cryptocurrency has been popular. The market has grown exponentially. People started looking at the possibility of adopting it as a new way of electronic payment. As Bitcoin and most other Altcoins have high volatility, the market hesitates on the risk. Stablecoin has become a new variation under cryptocurrency which is pegged to some fiat currency with stable exchange rate. Tether, also known as USDT, is one of the most popular examples that has a 1:1 exchange ratio with USD. While Tether set its company in Hong Kong, there are no existing stablecoins pegged to HKD. This project will be constructed with TRON, the blockchain platform which charges zero transaction fee, to develop a new stablecoin on HKD named the Hong Kong Dollar Token(HKDT). Moreover, a crypto wallet will be developed in React Native at the same time to provide cross-platform experience for non-technical users on peer-to-peer HKDT transactions. Besides the basic transaction function, additional features such as blacklist on dishonest spending will be researched. At the time of this report, the basic prototype has been developed and is waiting for testing to evaluate the performance. Utility features such as QR code generation and scanning is provided. In the next phase of development, more advanced features such as blacklist will be provided.

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Methodology

TRON

TRON is a decentralized blockchain platform established in March, 2014. It is one of the popular blockchain systems in the world. The total market value ranked 20th in all existing cryptocurrencies. It is also believed to be the second most popular token development platform after Ethereum. TRON is adopting the smart contract standard compatible with Ethereum as well to attract developers. The main difference between TRON and Ethereum, the more popular blockchain platform, is that TRON adopts another unique mechanism to make zero transaction fee possible.

TRC20 Contract

Fiat-backed Stable Coin is the cryptocurrency that every coin is backed with reserved fiat money. That makes an obvious difference with the basic cryptocurrencies such as Bitcoin or Ether as it should not allow mining actions or the Stable Coin cannot provide reserved fiat money as rewards to the miners. Thus, fiat-backed Stable Coin should always be done as a smart contract in the blockchain system to adjust the value when needed.

The basic form of a smart contract deployed with TRON contains six functions. The implementation will be written in TRON Solidity, the programming language for TRON. Fundamentally, the smart contract needs to be able to perform action such as telling the balance of one’s account and transferring tokens. The HKDT will contain all the functions although the implementation is still waiting for more testing. Additional features can be added to the contract when necessary.

NodeJs Library

After the Smart Contract is built, a library is required to provide all the functions related to the HKDT Stable Coin in the Ethereum Chain and it would need a lot of network communication and cryptographic functions. Building such a whole library all the way from the network layer will be time consuming. Therefore Web3 is adopted, which is a Node Core Module Library that allows the user to connect with Ethereum Network and use the service in the blockchain system. We are going to build a higher level api which uses the proposed HKDT Smart Contract.

React Native Application

While building the Smart Contract, Figma and Material UI will be used when designing the graphic user interface. Figma is a powerful UI design tool that can easily construct an interactive user interface and Material UI is a popular React UI Design Framework that provides common components and features that facilitate UI development.

After the UI design is confirmed, it will be implemented through React Native as the development language, because React Native allows developers to develop cross-platform applications that run on both IOS and Android with one code base. For better code management, React Redux will be used as the React Framework and would facilitate the development.

API server

To ensure trading function in the application is valid, an API server will be built for APIs required for the react native application and provide functionality of real time payment system which allow the trading between HKDT and HKD.

Also, the API server works as a third party between the trading of HKDT when users are using our application platform as trading tools. The API server will record the validated transaction in the database and handle the unhonest transaction for the HKDT market.

Timeline

Results and Deliverables

This proposal proposes a new stablecoin that provides 1:1 exchange ratio with HKD and therefore can be used as a substitute for HKD in trading. Since HKDT is sticked on the blockchain system, whatever the trading amount, the transaction fee will be the same. The blockchain system runs automatically and carries out real time transactions. Thus, it is going to serve as a new cashless payment with lower transaction fee at any time anywhere.

A mobile application that can provide services related to HKDT is another goal of the project. The application provides an easy-to-use interface for the blockchain system and transaction of HKDT can be achieved with a few manual steps. With the use of the mobile app, users can use the HKDT without prior knowledge on blockchain. The mobility nature would facilitate shops making transactions with the HKDT. The application is also the essential platform for HKDT and HKD exchange.

Documentations


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Project Plan
Available Now
Interim Report

Supervisor

Dr. John Yuen

Supervisor


Our Team

Lo Kai Man

Team member


Zhu Haihui

Team member