Topic: Stablecoins 101 - page 2. (Read 352 times)

DAI is not a panacea, it is also subject to management. Currently, there is not a single solution in the crypto currency world for saving and lending crypto currency that does not depend on the speculative BITCOIN exchange rate managed by the main owners, managed volatility is very beneficial for them.

The media published many accusations surrounding bitfinex/tether since 2017. These rumors are definitely nothing new.

As stated in OP. Banks and stablecoins are the two main paths whales use to purchase bitcoin and cryptocurrencies. A rise in tether purchasing is correlated with increasing bitcoin demand and buying volume. It seems many journalists write about tether and stablecoins without comprehending the basic roles and principles defining how they're used. It leads to uncertainty and many false allegations being made towards bitfinex/tether. Both of whom are very misunderstood.

After all the latest rumors surrounding tether and bitfinex I've decided to swap all my usdt to DAI stable coin instead, it seems things are getting hotter sir USDT right now and anything can happen, I'm not sure about binance exchange since they are also on fire right now, I don't know how safe BUSD is

It would be good to see more pegged currencies rather than just USD coins. The money printer is going crazy so there should be more widely available currencies like the Tether EURO. Pegging to a devalued currency is like devaluing bitcoin itself

There's no excuse that stable coins are a thing, and they have been helpful for everyone to trade and accumulate, etc. How about the US Governments want to have their own CBDC's? This is closely related to how they want their system to do and still have that "control" they always want.

Just a heads up: one important factor of centralized stablecoins is that they can be locked even when held in non-custodial wallets. Some people think that because something is a "cryptocurrency" and if you held something in your own wallet automatically means that it's permissionless. Really not the case with the USDT, USDC, and such.

PSA: Most Stablecoins Can Be Frozen, Even in Your Own Wallets https://bitcointalksearch.org/topic/updated-psa-most-stablecoins-can-be-frozen-even-in-your-own-wallets-5204055

Crypto volatility for retailers has been a hot topic. Merchants accepting crypto in exchange for goods can absorb losses if the price of crypto decreases, before its exchanged for fiat.

But not much has been said about crypto volatility on the buyer's end.  

The way markets are structured it is possible to "buy" bitcoin today using a service like coinbase. With the actual buy order being executed hours from when the buy order is placed. Price volatility can affect this buy order for better or worse. Long story short, volatility of crypto can affect buyers as well as sellers.

Buyers of crypto have sought methods of nullifying volatility on the buyer's end. This is where stablecoins enter the picture.

Tether being pegged to the dollar reduces volatility which could be present holding another currency or coin used as a medium to buy crypto. Stablecoins like tether can be exchanged for bitcoin and crypto simultaneously on exchanges. Reducing volatility present using other methods of purchase.

Reducing volatility on the buyer's end is one of the reasons stablecoins have taken off.

....

The other reason stablecoins are in demand is for crypto purchasing in larger sums.

If a whale wanted to buy $1+ million in bitcoin. They would typically have 2 main options.

1.  Banks
2.  Stablecoins