The Digital Economy Research Initiative, led by Harvard students and alumni, has launched the “New Bretton Woods Project” (NBW). This initiative aims to tackle the growing global debt crisis using innovative technology.
“Our goal is to create a ‘New Bretton Woods’ system anchored in Bitcoin. This will bring stability through a stablecoin. It allows users to avoid Bitcoin’s price swings while still offering potential long-term gains. This makes it practical for everyday use,” said Jacob, a lead member of NBW at Harvard.
At the heart of this project is a new Bitcoin-backed stablecoin that follows decentralized finance (DeFi) principles. By using the BeL2 infrastructure, NBW hopes to change global financial systems. It aims to provide creative solutions for managing debt and promoting financial stability among countries.
BeL2 acts as a Layer 2 solution for Bitcoin. It enables DeFi while keeping the main blockchain secure. Users can lend, borrow, and trade directly, without needing intermediaries. This promotes financial independence, all while sticking to Bitcoin’s core values of decentralization.
NBW is redefining Bitcoin. It’s not just a store of value anymore; it’s becoming a key part of the DeFi system. By utilizing BeL2, the project allows for the creation of smart contracts for Bitcoin-backed stablecoins. This way, users can engage in DeFi while maintaining Bitcoin’s essential principles of security and decentralization.
The stablecoin will be fully backed by Bitcoin. This means users can enjoy the stability of fiat currencies without having to sell their Bitcoin. This approach balances the security provided by Bitcoin miners with the potential for long-term growth.
The BeL2 framework supports various DeFi applications while keeping Bitcoin securely connected to its main network. Bitcoin can serve as collateral for Layer 2 applications, like decentralized exchanges and loans. The NBW team ensures all Bitcoin transactions happen on the main network for maximum security. Instead of moving assets between blockchains, they communicate with Ethereum-compatible networks to issue stablecoins, integrating technologies and building a resilient, decentralized economy.
“This initiative is timely as global debt reaches record levels. By combining Bitcoin’s decentralized structure with the stability of a pegged currency, we offer a financial system that reduces the risks of traditional economies. This highlights the real benefits of financial security and sovereignty,” Jacob explained.
“Our stablecoin isn’t just another digital currency; it’s a tool for global financial stability. We believe that providing a decentralized and stable currency will help individuals and communities face the challenges of the global debt crisis,” he emphasized.
NBW will soon be incubated at Harvard Innovation Labs. The goal is to connect traditional finance with decentralized systems. The team is dedicated to promoting financial inclusivity and enhancing economic stability.