Topic: Will governments destroy stablecoins in the long term? - page 2. (Read 800 times)

Yes, the government will be able to do all the centralized work as it wants these criteria are not considered when investing. Investors see the risk of changing governments and policies the government will suffer more if the process does not affect investment and growth for stability the economic growth of any country slows down capital market indicators and economic growth are interrelated the capital market does not like any kind of uncertainty. The capital market is not stable until it is clear what will happen when something good or bad happens for sure the capital market accepts it.

Governments can destroy stablecoins because they're centralized. But governments CANNOT destroy cryptocurrencies like Bitcoin or Ethereum because they're decentralized and censorship-resistant. The more crypto's level of mainstream adoption grows, the harder it'll be for governments to do anything against it. I believe that once CBDCs become a reality, centralized stablecoins will cease to exist. Only decentralized stablecoins like DAI and USDJ will be able to stand the test of time. Remember, stablecoins were only created as a tool for traders to gain the benefits of Fiat without having to cash out crypto directly to a bank account. It's like a "temporary bridge" between the world of crypto and Fiat, before CBDCs take the world by storm. A government-backed digital currency would make stablecoins completely unnecessary. I wouldn't worry about this since decentralized cryptocurrencies are all you need to achieve true financial sovereignty.

Nonetheless, no one knows what governments will do with stablecoins in the long term. Depending on how people use stablecoins, governments could either devise new regulations that will amplify or dampen their growth over time. If they go all the way down the drain, people will still have the option to sell decentralized cryptocurrencies for cash (Fiat). With or without stablecoins, crypto will be here to stay. Just my opinion

You are right the government cannot control stable coins or just any coin actually. I think even if the government launches their own stable coin, people are not going to use it because it would be tracked, traced and taxes will be imposed which ultimately sounds like making transactions from your bank account.

The reason stable coins like USDT are so popular is because they give you a solid way to store the value of your coins while also not asking for any KYC or giving your details to the government. The governments need to understand that freedom and privacy is the only and most important reason why cryptocurrencies are taking over, be it a stable coin or utility coin or just any crypto in general.

Having USDT in wallet feels like no risk of market movement while having complete privacy, which I am sure no government launched stable coins can achieve or even aim to achieve.

If it was as simple as that then they could have done so already, besides they do not really have a lot of justification to ban all cryptocurrencies on their country, and people living in relatively free countries are going to wonder why governments are doing this with a technology that does not harm anyone.

But the case of stable coins is different, stable coins are performing the same function of fiat and they are even using fiat to back their coins, the governments may argue those coins are too similar to their own and since those coins are centralized they could easily destroy those coins and force people to use their new digital currencies.

the question is, why should the government destroy the stable coin?

if the government wants it then the government only needs to make a ban regarding the use of cryptocurrency in its country, that's over. without needing to destroy anything, it doesn't seem classy anyways. The decentralized network is seen as a threat because the government cannot fully control and supervise, while for those who aspire to freedom, decentralization is a solution.

The possibility is without a doubt there, governments on the past have destroyed several attempts by people to create a centralized alternative currency that runs parallel to the fiat system we have in place and all of those systems failed because governments could just confiscate a few banks accounts and arrest a few people and claim those coins were too similar to their own and kill it that way.

This is why bitcoin is decentralized and it seems to me that sooner or later the governments are going to come for them as there is no way they are going to allow this once they develop and release their own digital currencies.

Yes mate you are right because governments have no power of destroy any cryptocurrencies but government can control their banking system al last.

Currently, decentralized stablecoins make up a very small percentage of the total number of stablecoins on the market. And I don't understand why traders prefer to use centralized stable coins, because the benefits of decentralization are obvious to everyone. Or maybe not everyone understands it after all?

That is the true answer. I do believe that the biggest stablecoin will be a decentralized one, after that CBDC will come and they will make a big noise when they first start but slowly and gradually will go down, and then the stablecoins we have right now. USDT acts as if there is tens of billions of dollars worth of interest towards it, but the reality is that every single day bitcoin rises people are moving away from it and moving towards others, which is why I think it is quite obvious we are not going to see those at the top anymore.

I know DAI is new and not a big deal just yet, but things like that will become the real stablecoin in the future, it may not be DAI, it could be something in the future that is similar to that but does marketing a lot better or people will use it a lot more, but it will be something similar to that to reach high levels.

If by stablecoins you mean coins that are not too volatile, then I strongly doubt they could do that to all stablecoins. The centralized ones could be destroyed, but the decentralized ones would be hard to stop.
Besides, a stablecoin does not have to be backed by fiat to be a stablecoin. You could easily turn a very volatile crypto into "stablecoin" by moderating its volatility (without compromising on the deflationary feature)

In regards to the bolded, decentralization definitely doesn't make cryptocurrency unstable. You could keep lots of the extremely volatile decentralized crypto fairly stable by regulating their supply in relation to demand.

it can very well happen, because in my opinion the government loses a lot if the circulation of money continues and increases in the crypto market, the losses experienced by the government are in terms of taxes, because as we know that crypto transactions do not yet have taxes

When the governments of different countries introduce a national digital currency, then in my opinion centralized stablecoins will give way to CBDC. But by that time, the crypto community will understand that a real stable coin can only be decentralized, and in this case, states will not be able to compete with it.

They do not even need a reason,,, when have they ever needed a reason other than to remind the people that they rule that they are the ones in power?

Once governments control coins and learn how to use the technology for their own games, then they will allow it like China has allowed and developed their own China coin.

Then why it is called as stable coin if it can be destroyed by someone or some group of people? That coin should have also stable defense system mechanism to protect its own environment.

But what we should know is that USDT is a global business. And it benefits the government if they work well together, not by destroying what is already there. USDT or as stable as coins that already exist today are not only in America but also on various exchanges in various countries. This means that they get support from other countries. If the government issues other stable coins, of course they will also have to get support from various other countries to be recognized as official coins, equivalent to real money. Although crypto is easily circulated, the government has the power to blacklist every coin if they consider the coin to be unofficial.

The subject of the lawsuit in the ripple case was that the SEC believed that two executives at Ripple Labs had abused the coin. There were no claims from the SEC to the circulation of the XRP coin itself, and therefore nothing threatened it from the very beginning.
The situation with stablecoins is completely different. A significant part of them are backed by the currency of states, and these states can claim that their currency is their property and prohibit anyone from using it as collateral for the circulation of other stablecoins. Since the existing stablecoins are direct competitors of the CBDC states that will appear soon, then such a move by the states would be quite logical. The Chinese government already attributes this in its regulations, which will ensure the circulation of the Chinese digitalized yuan.

Yes, there are a lot of chances for governments to prohibit stablecoins for any reason. If anything like that happens then we cannot expect those reputed exchanges will keep listing stablecoins as they need to comply with government rules, they will simply delist stablecoins.

I'm not expecting people will go for P2P way of trading for centralized things. Because, if governments prohibit stablecoins then its value may not remain stable which means there will be no more point of trading them even in P2P manner. I am also in favor of decentralized stabelcoins. Hopefully we will get something like that in coming years.

Prohibitions will not work on decentralized currencies like Bitcoin of course since they are always easily found and available on p2p networks and not just on centralized exchanges.

But stablecoins are by nature centralized. If they are banned, no regular exchanges will want them and very few p2p people do Tether swaps,,, much less other stablecoins!

Whether stable or utility coin, there is none any government can quash. The current suit between the US SEC and the Ripple (XRP) as an organisation is a proof. The case proves that the individuals that adopts a cryptocurrency are the major determinant of what it becomes. You can also see what has become of the Shit coins lately.

I think stable coins are here to stay, nothing would happen to it. The sheer will of the entire crypto community is enough to make them immune from government meddling