Topic: Is the market saturated with too many stablecoins? (Read 479 times)

Agree. The more stablecoins on the market, the greater the competition will be. I'd imagine that renowned banks will launch stablecoins of their own for the whole world to use. COVID-19 has just increased the popularity of crypto/Blockchain tech, so I wouldn't be surprised to see more stablecoin offerings in the future. As far as centralized stablecoins go, I would think twice before putting all my hard-earned money on them. Apparently, stablecoins like USDC and USDT are too centralized to the point where the stablecoin issuer can freeze your assets on the Blockchain. Centre has already done this a while ago (link to article), while Tether has followed suit (link to article). It shows us that most centralized stablecoins are subject to a single point of failure, effectively bringing traditional banking to the Blockchain (Banking 2.0).

Considering that centralized stablecoins are too vulnerable towards manipulation, I'd say that decentralized ones could take the world by storm in the future. As far as I know, there's only one decentralized stablecoin backed by decentralized crypto assets. And that one's called "DAI". The market may be saturated with centralized stablecoins, but it's in need for more decentralized options. Believe me, once people face the same situations as traditional banks by using a centralized stablecoin, they'll leave the game. Blockchain tech is all about decentralization than anything else. While at some point regulation is necessary for the industry to thrive, sometimes it's taken too far than usual. Time will tell us whenever stablecoins have been a failed idea or all the other way around. Just my thoughts

True! I can't think of any negative effects of stable coins backed by real money for the cryptocurrency world. The problems of fiat-backed stable coins stick with the problems of its own countries. The cryptocurrency market is considered as the most independent market that doesn't rely on any particular national economy. That's why it's expected to be a worldwide currency. Therefore, nothing to worry about when there are more stablecoins in this market.

Stable coins created by respective countries have border restrictions so it won't affect the adoption of centralized stable coin like tether, the only problem will be the coin will be burst at some point due to excessive printing of them with no limitations.

Agree! I don't think the existence of stable coins in the cryptocurrency world will harm our market. Otherwise, many fiat-backed stable coins on the market can give traders more choices in investing and exchanging their money based on the differences in the exchange rate. I would doubt if a trader worries about the appearance of stable coins, isn't it beneficial for us?

I don't think anyone in crypto would need to be worried about that.
Already the biggest volumes are with direct pairs with USD. Any deviation from actual FIAT is in my opinion a good move. Pegged currencies of course aren't a great improvement but at least they are not a direct endorsement of the bank system. Some of them are even more centralized and trust based too! But that's why it's good to have currency competition.
The more stable-coins there are, the more competition there will be for better products, and the more pressure on banks to be more accepting of crypto or lose deposits to their competitors.

Good point. DAI could go down the drain if ETH's price goes all the way to zero. Based on this flaw, centralized stablecoins would work better with Fiat reserves instead of being backed by a highly-volatile cryptocurrency on the market. Personally, I'm not quite a fan of Tether because of its lack of transparency. Yet, people seems to use it more than anything else because it's the biggest stablecoin on the crypto market. The Tether company might be artificially pumping its token to keep it on the top spots in market cap. If its bubble bursts someday, it'll be a huge blow to the entire crypto market as we know it. There are far better options to choose from which have a greater level of legitimacy than Tether itself.

For instance, Gemini Dollars and Binance USD are widely regulated in the mainstream world. They're backed by reputable crypto companies in the Fintech space, unlike Tether USDT. Regulation is what is needed in order to keep the industry as legitimate as possible. There may be many stablecoins on the market right now, each with their own level of legitimacy. I think it's better to have lots of stablecoins on the market in order to ramp up the competition. The more stablecoins there are, the more options will be available for everyday people. The same could be said to traditional altcoins on the market. Time will tell which stablecoins will remain in the space and which will fade into oblivion. Only those that keep their promises will be actively used in the mainstream world. Just my thoughts

We need to figure out which stable coin to use. In addition, now about 80 percent of all states are working on the creation of their national stable coins, that is, their digitized currencies. Their use will be much safer. Private and commercial stable coins will disappear much more often what is the default of the state.

If anyone knows how to use stablecoin like USDT, you know how to make money on exchanges. Its not just USD that is pegged these days but also the other fiat currencies like Yuan and Ruppee. AS long as exchanges are using these stablecoins, it will appear like its safe to use them despite being unaudited.

Tether.io can print more USDT though and then use it to buy BTC when the price drops then it's going to be a huge profit for them. There has to be reserve auditing for these stablecoins because they are not like DAI.

Yes, competition will facilitate development.
When stabecoin projects compete fairly, we will know which projects are good and which are of poor quality. Besides having more competition will increase the choice for everyone.

In fact, there are too many stable coins being launched in the market and people cannot know them all. However it is necessary and good for everyone and for the cryptocurrency market, competition will see development projects and investors benefit from that.

Having Many stable coins in crypto market won't do any damage, some will definitely fail but I prefer transparency stable coin projects like USDC which is from Coinbase and BUSD which is from binance team

Nope, the raise of stablecoins is getting scary lately with usdt  minting new tokens without control. i wasn't happy when Tron joined the Usther blockchain. they will mess the whole thing out of control. USDC is my preffered choice because it has a solid transparency and a redefined structure.

But how can we actually trust every stable coin which is backed by USDs even the project tether is printing more money and injecting them into the crypto market which will surely affect the prices of altcoins because USD value is getting diluted here in the form of stable coin.

I agree that in recent months a lot of cryptocurrency companies have created stablecoins for various reasons, and it is not clear whether this is good or bad, but we will continue to monitor the cryptocurrency market and later it will be more visible what this will lead to.

Even if the number stable coins reach 1000 it won't hurt crypto at all, the use case of stable coins is to backed your assets at 1:1 USD price which is very useful for traders, you just have to decide which one you've prefer between centralized USD coins or decentralized USD coins

Definitely the main function of these stablecoins. Otherwise, these thing won't be a thing, these stablecoins couldn't even hold a candle against other cryptocurrencies in acceptance among online ecommerce for payment method. If a stablecoin couldn't save the money of people from fluctuation then it's as good as a ripoff coin.

In my opinion, there are already a lot of alternatives.  Stable coins are exactly the assets that have saved the deposits of many traders. I speak from experience))

inspected by authorities really ? i didnt know that its possible here on this space but i though all here are online and not being monitored by some authorities  but there are so called detectives that tracks down fraudster . its normal that theyl be transparent and show thier supply or other info because how will the people know or invest  if they wont show thier details . in the crypto world anyone can create a coin and yes its easy money if investors invest on it or if your good at promoting/scamming  .

usually a reliable stablecoin will usually have their asset published transparently they also might have been inspected by the authority but to further prove its actually more complicated than that and its true that these stablecoin is easy money, if it's not then why there's so many stablecoin keep appearing each day.

I don't see any danger having too many stablecoins in crypto space, some will be good and some will be bad and I'm pretty sure that people like going for the best stablecoin in terms of marketcap which is why USDT still have upper hand till date, you just have to choose, you don't care about centralized then USDT is the best, if you want something more secured? Then find decentralized stable coins