This is not the only problem, but these currencies are centralized and your money can be frozen even if it is inside your wallet[1]. Ownership of such currencies is not limited to the private key that you own, but rather it belongs to the company and gives you the right to use it in exchange for paying its full value, so it is worse than cash, which enables you to act absolute in it.
Topic: Just Learnt About A Major Risk Involved In Stable Coins - page 2. (Read 296 times)
This is not the only problem, but these currencies are centralized and your money can be frozen even if it is inside your wallet[1]. Ownership of such currencies is not limited to the private key that you own, but rather it belongs to the company and gives you the right to use it in exchange for paying its full value, so it is worse than cash, which enables you to act absolute in it.
Unless and until you are into trading or want to do a transaction of fixed amount, it is good if you stay away from stablecoin. They are lot more risk & uncertainty involved in keeping stablecoin. It is better to always have Bitcoin over any other cryptocurrency, if you want to convert your fiat to crypto.
Can you also agree to the fact that even the so-called stable coins are not always stable?
Many stable coins ask us to have faith that they're backed by reserves, kept in banks. They want us to think it's different from Bitcoin.They are only trying to bring an old way of doing things, but on a blockchain.
This forum is really helpful I must confess.
That's indeed right and I tend to agree that you'd become knowledgeable and full of awareness while you are here in the forum.This community is good for learning about crypto.
Stablecoins are not designed for long-term growth in the same way that many other cryptocurrencies aim to appreciate in value over time. However, this stability can also be a valuable feature for investors looking to preserve their wealth without being exposed to the extreme price fluctuations associated with more volatile cryptocurrencies. So, isn't a pretty good idea to hold a stable coin but yes, it's useful in trading activities. It's frequently used for trading purposes and traders can swiftly move in and out of positions by converting their holdings into stablecoins during times of uncertainty or market fluctuations. So basically, stablecoins are commonly used to provide liquidity in decentralized finance (DeFi) applications and platforms, allowing users to earn returns on their holdings, not intended to hold them for a long term.
How and why do stable coins depeg?
Why do stablecoins depeg?
In 2022, Terra algorithmic stable coin UST depeged and there are months with many attacks on some weao stable coins. Anotjer famous one is Tron USDD but Justin Sun had to use big money to support and save to peg.
Tron USDD stable coin wobbles from dollar peg.
Why do stablecoins depeg?
In 2022, Terra algorithmic stable coin UST depeged and there are months with many attacks on some weao stable coins. Anotjer famous one is Tron USDD but Justin Sun had to use big money to support and save to peg.
Tron USDD stable coin wobbles from dollar peg.
This forum is really helpful I must confess. I never knew about Pegging and Depegging. But after my previous post on whether to save in stable coins or my local currency, I got to know that even stable coins have their own risks involved, in which Depegging is one of the major risks
I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
I don't to think there's a need to open another thread since you have initially created a topic about stablecoins. You got a lot of valuable replies from forum members, if you wanted to appreciate their responses or have any further questions to ask you would have done it on the same thread. I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
Stablecoins can be pegged and depegged any time, the depegging could be a soft or hard one and example of such cases is TerraUSD[1]. Aside being depegged, they are centralized and can be frozen[2] as well. When a hacker or scammer steals a stablecoin and it's quickly reported before it is converted to a decentralized coin like Bitcoin or ETH, the stablecoin can be frozen and rendered unusable by the hacker.
[1] The fall of Terra
[2] Circle, Tether freeze over half of the $126M assets stolen from Multichain breach
I got to know that even stable coins have their own risks involved, in which Depegging is one of the major risks
There's nothing that does not have its own risk, we only try to play safe and manage ourselves in taking the risk alongside to serve us the benefits of doubt as an advantage in whatever we do in cryptocurrency, stablecoin are pegged currency in local fiat currency value, mostly USD, it may not be as volatile as other cryptocurrencies because it's been pegged but it's just only a way of holding down an asset without having any benefits that may come in through that, instead the value of the worth may even depreciate as at when making conversion provided same thing is experienced with USD, many still prefer other cryptocurrencies or even bitcoin the most because of the future opportunities in holding it unlike any other digital currency.
I am glad you found useful content on this platform. And from my personal experience on this forum, I advise you to stay here if you want to learn more. And my advice for you in the stable coin is to never store your funds in stable currency, especially in USDC. As USDC has some high volatility levels. Store your assets in Bitcoin because of many factors. One of them is that BTC is the best investment against inflation as it is a hedge against inflation.
This forum is basically about crypto, and the more time you spend here, the more you will learn. To be honest, I am still learning a lot of things from this forum, and who knows what I will learn further? But investing time here will bring good fruit to your table. Your efforts to learn new things never go to waste.
This forum is basically about crypto, and the more time you spend here, the more you will learn. To be honest, I am still learning a lot of things from this forum, and who knows what I will learn further? But investing time here will bring good fruit to your table. Your efforts to learn new things never go to waste.
I believe it's as a result of market demand. Correct me if I'm wrong.
You are right, and yes there are many other factors also exist which impact pegging and de-pegging. This forum is really helpful I must confess. I never knew about Pegging and Depegging. But after my previous post on whether to save in stable coins or my local currency, I got to know that even stable coins have their own risks involved, in which Depegging is one of the major risks
I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
We do understand how grateful you are to the forum members. Thanks for the appreciation and good luck with your journey in the crypto world.
Stablecoin may not be always stable but it provides traders with speculative opportunities. Those who exchange their fiat or other volatile cryptos for a stable currency have the intention to rebuy volatile crypto assets or they want to provide liquidity in any DeFi application. In most cases, this is the fact. People do not want to keep stablecoin in their portfolio because it will not grow. If you haven't done anything bad like hacking any protocol your assets won't be frozen I think. It is not like they freeze your stablecoin without any reason.
This forum is really helpful I must confess. I never knew about Pegging and Depegging. But after my previous post on whether to save in stable coins or my local currency, I got to know that even stable coins have their own risks involved, in which Depegging is one of the major risks
Glad that you've learned and appreciated everyone's help from the thread you've made. It's true that there's pegging and depegging. Talking about depegging, there have been series of stable coins that have already been depegged. Most of them that have permanently depegged were not even that popular but you get the idea that it's possible. Whilst for some popular ones, you can see that they're not exactly the value of fiat that they're pegged with especially with USD.
A little bit of discrepancy like a few cents and that's already giving you the view of it.
I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
You'll learn more and it's not just the newbies that keeps on learning, even us. 
There could be things that you know but we don't know and vice versa, enjoy your stay and learn more.
Just stay here, and you will get to learn about the wonders of digital finance. In my short time here, I also learned a lot and am still learning a lot of new things. It means there is nothing here that could bore you, but you have to find the right section. And the thing that you learned about pegging and depegging, you should also insert that learning here in this post, or at least put the link to the topic that you created for asking about pegging and depegging.
This post is nothing more than stating the fact that you liked the forum so much, and to be honest, we all do, especially those who have been here for more than 10 years.
PS: The forum has a lot to learn.
This post is nothing more than stating the fact that you liked the forum so much, and to be honest, we all do, especially those who have been here for more than 10 years.
PS: The forum has a lot to learn.
This forum is really helpful I must confess. I never knew about Pegging and Depegging. But after my previous post on whether to save in stable coins or my local currency, I got to know that even stable coins have their own risks involved, in which Depegging is one of the major risks
This is not the only problem, but these currencies are centralized and your money can be frozen even if it is inside your wallet[1]. Ownership of such currencies is not limited to the private key that you own, but rather it belongs to the company and gives you the right to use it in exchange for paying its full value, so it is worse than cash, which enables you to act absolute in it.With the exception of DAI, almost all stablecoins are highly centralized.
Read more ----> PSA: Most Stablecoins Can Be Frozen, Even in Your Own Wallets
[1] Circle Confirms Freezing $100K in USDC at Law Enforcement's Request
Can you also agree to the fact that even the so-called stable coins are not always stable? They try as much as they can to retain the exact amount equal to that of the dollar or whatever currency they are pegged with, but over time they usually lose some value. For example, it sometimes moves from the figure of 1-1 and brings it over to 100/99; that is to say, 100 USDT might be worth 99 USD. The pegged one is losing some value, but this is not caused by it being depegged; I believe it's as a result of market demand. Correct me if I'm wrong.
This forum is really helpful I must confess. I never knew about Pegging and Depegging. But after my previous post on whether to save in stable coins or my local currency, I got to know that even stable coins have their own risks involved, in which Depegging is one of the major risks
I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
I'm very happy I asked the question and other users really responded very well. All the responses were really helpful. I think other newbies like myself learned a lot from the replies.
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