Topic: “Insurance booking” against volatility (Read 118 times)

Your idea is unclear for me. No cryptocurrencies are stable now; creating a stable currency is a very difficult task. Maybe stablecoin can be created through controlled emission (which counteracts price spikes), but then there will a problem of trust to those who control the emission. Probably, bitcoins will automatically become stable when their capitalization increases by 1000 times (more “heat capacity”), but this is a long time to wait.

Another way this could be done is to have the uncle from England send willy Bitcoin that is guaranteed to be stable. Example: send $1000 worth of Bitcoin via a special platform that will maintain the price at $1000 till delivery.. . This won't be affected by volatility
.
The special platform can do this by automatically converting the bitcoin to stablecoin but still delivers Bitcoin to the recipient. The recipient can then withdraw his Bitcoin at exactly $1000 or buy stuff with it. While buying stuff the conversion from stable-bitcoin to Bitcoin happens automatically without him even knowing.

People should choose whether to have stable or volatile Bitcoin.

If there was a way you could make money running an insurance racket, I'm sure someone would have done it by now.

The industry needs to mature for another decade or so before rate tables could even be calculated.

  I’d like to suggest an idea for the cryptocurrencies community.
  It is known that one of the main problems of cryptocurrencies that contribute to their depreciation is their volatility (rate instability). I wonder if this problem can be solved by purely, so to speak, non-technical methods like insurance.
  Let’s consider that Uncle David from England decided to send Bitcoins in the amount of $ 1,000 to his nephew Willy, who lives in Australia. The purpose of the transaction is precisely the transfer of ordinary money, i.e. British pounds to Australian dollars, with conversion.
 To do this, Uncle David first converts his pounds to bitcoins, then sends the bitcoins to Willie, and then Willie transfers his bitcoins to Australian dollars. Suppose there is no loss due to the spread (am I confusing the terms?) and bitcoin deflation, but there will be another problem: most likely Willy will receive an amount equal to either 900 US dollars, or 1100, and with a small probability - either 500 or 1500. The point is that the whole operation will take time, during which the exchange rate may change. I.e., the “average size” of this transfer is $ 1,000, but Willy needs the money to buy an iPhone specifically for $ 1,000; and either he will have an extra 100 dollars that he does not need, or he will not have enough 100 dollars to the amount of the purchase - and such a situation as a whole is disadvantageous for him.
  This can be illustrated by the alleged benefits of insurance - the cost of insurance will not make you unhappy, but the absence of insurance in case of a problem situation will do. I am used to reasoning in such categories because I have read materials on game theory. And here’s the idea to solve the problem described above, with the help of a big insurance company that gives Willy the missing $ 100 if he received 900, and if 1,100 came, it takes $ 100.
   I would suggest implementing all this, for example, in the following way. There will be one firm for “booking”. When making bookings, Grandfather David agrees not to buy a certain amount of bitcoins, but to spend a certain amount of pounds in some local exchanger, on time. After the purchase, he shows the general company an invoice to prove that everything was correct. At the same time, Willy agrees to buy a certain amount of Australian dollars, or rather, the company promises to either give him some Bitcoins, or vice versa withdraw so that he receives the exact amount of Australian dollars.
  Sorry for bad English…