Topic: Are stablecoins a definite solution against a bear market? - page 2. (Read 1330 times)

Everything must have a risk, friend. As a day trader, stable coins are quite helpful when suddenly there are unexpected market movements, there are times when all prices suddenly go down, that's the right time to turn it into a stable coin, with the note that it is only temporary and for a relatively short period of time. So it does not come out of the market completely, when price movements have begun to look good and conducive it can be quickly converted into coins or other tokens as desired.

I don't think stablecoin is a good solution in the bear market because we can swap it with real dollars, btcs and altcoins in some exchange. So while crypto price is still affected by many things, I recommend that you don't keep your stablecoins as an asset. If you want your investment to recover, then go all in the real dollar. If you still want to maintain a stable coin as an asset, what if some country release a new law to shut off that stable coin, then who can guarantee that you can get your money back.

That's certainly true, mate. There's some level of convenience when using stablecoins for all of your crypto trades. Sometimes, it's much better to use a stablecoin than Fiat directly as you can gain instant access to the value of $1 USD without having to wait a couple of days to receive money in your bank account. But I'd have to admit that there are too many stablecoins on the market, which is more than enough for the average trader/investor. Only exchange-backed stablecoins will survive in the future, while the rest could become worthless in the long run. I used to remember a stablecoin called "NuBits" that was always worth $1 USD. But its model failed in the long run, mostly because it was not backed by a reputable exchange in the mainstream world. Everything was based on pure algorithms and buying back NSR shares. It's today where 1 USNBT is worth less than $1 USD, leading to undesirable losses among early investors of the same.

I hope that neither DAI or Tether would turn out to become like NuBits in the future, as it will become disastrous for the reputation/image of the crypto industry. As long as stablecoins retain their price of $1 USD per coin, they'll be the most ideal solution for a bear market. Your last resort would be to cash out your crypto towards your bank account for safekeeping. All in all, stablecoins prove to be of great use both for the average trader and serious investor alike. Just my opinion

Crypto currencies also have their own volatility, but volatility is very different from other crypto currencies, stable coins tend to be FIAT original prices on the stock market, so don't worry if you keep stable coins during the bear market

I highly agree that those stablecoins is the definite solution for the bear market and it is much profitable than those altcoin who are only for pump and dump scheme which is i think bad for the market.

And i think that only the top ranked coins is the one who can make it and stabilize their value even thou the market is in crisis.

I think everyone has their own strategies to be able to stay in cryptocurrency and at bear market conditions. Some people will definitely prefer stablecoins when the bear market is arguably the right way to survive in cryptocurrency and to become our assets so as not to lose a lot of losses, but some people just don't want to do it and they prefer to stay trying to make a profit from coins that they think are potential, although this is arguably more risky but maybe they think it's something they are used to doing.

tether sometimes will value to $0.99 and there are times that it also goes $1.01, a cent is not that much but if you have about a million USD like the whales in crypto, they might just complain why its price still fluctuates while its suppose to be stablecoin. stablecoin had been a great hedge for traders specially in the bear market, you wouldn't want your money drained out while the rest of the BTC holders are shorting.

Users need to understand that stablecoins were not designed to remove the problem of volatility. On the other hand, the very first stablecoins were invented in order to get around the restriction of using fiat currency in crypto exchanges (especially in China). Therefore, stablecoins doesn't represent the solution of keeping your wealth secure in a bear market. You need to think about the other options and strategies.

maybe you only do an assessment on Tether, I suggest you can start using USDC because they use the officially audited circle foundation to connect to the bank, I'm sure this coin is really to your liking. It doesn't matter if you prefer fiat, but the topic is whether stable coins become a trading solution during the bear market, and of course I would say yes, if there is a slight change, prices will always adjust to 1:1.

Are stablecoins a solution against a bear market?

It depends on what you may expect from cryptocurrencies. If you consider cryptocurrencies as a form of investment - then in accordance with the rule "buy low, sell high" it may not be the case at all.

Still, buying stablecoins could mean that on many of exchanges you could buy other coins faster than by sending a wire transfer and waiting yet another couple of days for an update of your account balance (when the price may not be that attractive).

If on the other hand, the volatility of cryptocurrencies is an obstacle for you for sending funds (and you are not a fan of xrp), then stablecoins could be interesting (especially if you want to sign a long term contract with companies located abroad). The only fear here, as shared by many cryptoenthusiasts, is that stablecoins are on this moment purely fake and not backed by fiat money 1:1 as promised.

As well, depending on WHERE we observe a bear market - stablecoins might not be very attractive if the bear market applies to the economy of the country, to which fiat currency a stablecoin is pegged.

When we talk about the bear market, then of course, many investors may simply not be able to withstand and sell their cryptocurrencies, moreover, all this is a hello to loss. The option of saving funds using stable coins may well help in this. Of course, a small fluctuation in the prices of stable coins is not as scary as a drop in the prices of cryptocurrencies in general. I also studied stable coins and they showed good stable value in the market.

I agree it can be a solution but only if its truly backed at 1:1 rate, some devs might commit fraud, i'll only trust stable coins if the backed asset is confirmed by a trusted bank, there are times tether go below one dollar but it doesn't go above a cent i don't think that's a problem if you trust stable coins, i'd rather have my money in fiat.

It can be if they are really a stable coins who is backed up by fiat money at the rate 1:1, if there are complain against it then is hard to trust it and hold a lot of money on because if something happen and will not value 1 usd then is hard to put money there.

In short, Stablecoin is one of the stable coins that I usually use when the market is down because I don't like to take too much risk. therefore sometimes stablecoin can be used when we are afraid of declining market conditions.

Sorry to ask cause I only have a little knoweldge about stable coins. Do they increase/decrease they value just like any other coins or not since they are pegged to a certain currency? If they are not decrease their value, there are any chances it would make cryptocurrency stable not definitely a solutions for a declining market.

In the bear market, Stablecoins like USDT, PAX, USDC .. will help you to be safe and not lose if the prices of altcoin and bitcoin fall. You can even buy more altcoins and bitcoins for that amount. For more than 1 year almost all traders have been holding stablecoins to wait for a suitable point to invest in the market.

Personally stablecoins provide catharsis for people in times of uncertainty especially when huge coins in the market dumps their prices. They have been a huge help so far in keeping the cryptocurrency industry alive. Though fiat still poses some help, I would say that stablecoins take the cake this time.

I have seen this argument but was more of stable coin to Fiat. I like to adopt what the big guns in the market do when keeping their profits,which is putting your profit in fiat. Though there might be tax implication with some countries when fiat is used but fiat in this bear market had been more reliable, maybe because tether lost it at a point and Dollar was more consistent that ever.

I'm supposed to think this before but when the moment I really engage in crypto, I realize that it couldn't be. The market isn't just of having stable coins to make it less volatile but the fact that we are depending on the market demand and supply, it all becomes impossible. That makes me think that crypto market has to have a unique market design and definitely we can't stop this volatility.

I don't know for sure if they're a definite solution, but the utility of stable coins is pretty consistent, especially when trading. Starting off as a beginner within cryptocurrency and market trading is incredibly hard for a person to jump into with no prior knowledge regarding trading and business finance. Stable coins made learning to trade a little simpler, because practicing trading with a stable-coin paired with a regular crypto-coin makes
the dynamic process easier to understand for a newbie.