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ETH as a Collateral
This section talks about why ETH is used as a collateral for ARTH.
Ethereum (ETH) has been chosen as the primary collateral for ARTH for several reasons, which include its decentralization, liquidity, scarcity, and the demand-supply curve.
Ethereum is a decentralized platform that runs smart contracts, making it a perfect fit for a decentralized stablecoin like ARTH. Its decentralized nature ensures that no single entity can manipulate or control the system, leading to a more secure and reliable collateral base.
ETH is one of the most liquid cryptocurrencies, with a large trading volume across various exchanges. This means that ETH can be easily converted to other cryptocurrencies or fiat currencies, making it ideal collateral for a stablecoin like ARTH.
Ethereum has a limited supply, which gives it inherent value. By using ETH as collateral, ARTH benefits from the scarcity-driven value proposition of Ethereum, providing a stable backing for the stablecoin.
The demand and supply curve for ETH is generally considered to be favorable as its utility and adoption continue to grow. As the Ethereum network becomes more widely used, the demand for ETH is expected to increase, leading to potential appreciation in value. This factor further solidifies ETH as an ideal choice for ARTH's collateral.