The Terra Alliance has grown to a large number of e-commerce companies in multiple countries, each with its own regional currency. A currency needs to retain its purchasing power with respect to local currency if it is to be widely adopted as a domestic unit of account and medium of exchange. Terra aims to be a family of cryptocurrencies that are each pegged to the world’s major currencies. This will include currencies like the USD, EUR, CNY, JPY, GBP and KRW. Terra’s flagship currency, TerraSDR, will be pegged to the IMF SDR and serve as the unit of account for the Terra protocol (eg to denominate transaction fees). The SDR’s low volatility relative to any single fiat currency makes it a robust benchmark for our flagship currency.
To make conversions between currencies within the family frictionless, the protocol supports atomic swaps at the appropriate fiat exchange rate. The seamless flow of capital between each currency unifies the family into a single macro-economy and lays the foundation for radically more efficient foreign exchange and cross-border payments.