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Coinbase suspending USDC:USD conversions over the weekend

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Re: Coinbase suspending USDC:USD conversions over the weekend

#161

Post by baremetal »

drexlspivey wrote: post #110
wil421 wrote: post #102

Earlier quoted context omitted.

Except a $100 bill is likely accepted. I’ve been to developing countries that will accept local currency, dollars, and euros. I doubt they would accept any pounds, tethers, or other fake electronic currency.

This is hilarious. Do you really think you can pay with USD in any random country?

I am under the impression that pretty much anywhere in the developing world USD will spend. Maybe not in the west, but places that have a weak currency like africa, the middle east, and south america.

Here are a few cherry picked examples

https://www.reuters.com/world/americas/half-payments-caracas...

https://www.tripadvisor.com/ShowTopic-g293974-i368-k4798488-...

https://www.voanews.com/a/lebanon-leans-on-us-dollar-to-cope...

Re: Coinbase suspending USDC:USD conversions over the weekend

#162

Post by tarunupaday »

bombolo wrote: post #84
pclmulqdq wrote: post #50

Earlier quoted context omitted.

There's something to be said for everyone knowing the risks of doing business with you, and behaving consistently (consistently badly) so that those risks don't change. That's the regime of Tether. Nobody will even be mad when the rug gets pulled. The federal reserve could stand to learn a thing or two, honestly.

USD is backed up by USA army. If a country refuses to accept USD they will have a democracy problem and get attacked.

India is a developing country. Are you somehow under the impression that the US army will attack a coffee shop in New Delhi if they stop taking US dollars?

Even in those parts of Mexico and Caribbean countries where the economy is heavily dependent on US tourism - and the US dollar will be accepted at retail shops; the price difference between paying in dollars and paying in local currency is going to be against the US dollar, and for any significant transaction, you will be better off paying in the local currency.

More to the point, it is true that a considerable part of international trade is conducted in USD. It is also true that the USA tries very hard to keep it like that (more so through economic sanctions than the military might), but it's hyperbole to state that any country that does not accept USD will get attacked.

For example, India and China buy a non-trivial part of their oil in roubles and have not been attacked - so far.

Re: Coinbase suspending USDC:USD conversions over the weekend

#163

Post by Gare »

vasco wrote: post #80
loveparade wrote: post #35

Earlier quoted context omitted.

No, in many countries you cannot buy USD directly. You also cannot store USD in a local bank account. And in various places it's explicitly forbidden to hold USD as savings because it would devalue local currency if everyone started transacting in USD instead. So, the "C" makes USD exposure available to anyone worldwide, assuming you have e.g. an Ethereum wallet.

So you are saying that there are countries where USDC is legal while opening a foreign brokerage account like IBKR and converting your currency to USD is illegal? And this is not just a perceived loophole? Could you give an example of a country like this so I could google?

Yeah, how is this different than black market trading (which happened a lot in ex-communist countries including mine, but the currency traded was usually German mark).

Re: Coinbase suspending USDC:USD conversions over the weekend

#164

Post by machinima40 »

Symbiote wrote: post #141
wil421 wrote: post #102

Earlier quoted context omitted.

Except a $100 bill is likely accepted. I’ve been to developing countries that will accept local currency, dollars, and euros. I doubt they would accept any pounds, tethers, or other fake electronic currency.

Pounds have reasonable acceptance in Africa, the Middle East and parts of Asia -- many of those countries either used to be part of the British Empire or a neighbour, so there's trade, emigration, etc. Probably the Caribbean too, though I haven't been there. In most cases e.g. a French tourist would be fine taking euros, but a British tourist can take pounds and not pay to convert to dollars or euros first.

Really? Pls back this up with a citation or example. Name one country in those places or outside of Britain for that matter where british pounds are accepted as currency - today and not 1950

Re: Coinbase suspending USDC:USD conversions over the weekend

#165

Post by Karunamon »

iudqnolq wrote: post #159
mtlmtlmtlmtl wrote: post #103

Earlier quoted context omitted.

Hey, nice straw man. Of course I think banks should cooperate with the government. I just don't think banks should be more powerful than the gov, which in the US, arguably they are in certain contexts. And I never said crypto anything was stable on any level. I genuinely believe crypto has 0 usefulness for anything other than very specialised cases, usually to do with avoiding regulation. The point I was making was t…

What you're missing is the bailout is part of the system, and counts towards its stability. In your analogy imagine your SAAS product horribly crashed and deleted customer data. So your cloud provider restored from the backups you had arranged and you were running normally soon after. Not ideal, but you had a far more stable system than someone without backups.

That only matters if you think that capability to be "bailed out" is legitimate in the first place. There is a pretty good argument to be made that allowing institutions to be "too big to fail" is directly enabling a lot of bad behavior, behavior that wouldn't happen if there was an understanding your bank can fail and you will not be compensated as a shareholder, only as a depositor under FDIC

Re: Coinbase suspending USDC:USD conversions over the weekend

#166

Post by blululu »

pavlov wrote: post #116

Crypto was supposed to liberate you from the traditional banksters. Instead it’s an impenetrable smokescreen where you’ve got uninsured credit risk with institutions in Silicon Valley and the Bahamas and who knows where, and you won’t know until the edifice cracks and your money is stuck. Not a terrific improvement. Of course the Bitcoin maximalists will shake their heads, mutter about self-custody, and then go on co…

Don’t have any horses in this race, but this feels like a straw man. Getting told to go die by a centralized exchange is exactly the kind of problem that crypto solves. The trouble is a ton of web3 startups (like coinbase) worked to undo this feature to improve usability. Pretty much every crypto person I know who has been in it for more than 5 years will insist no keys no coins. A lot of the innovation in web3 consisted of pulling back the decentralization inherent in a lot of blockchains.

Re: Coinbase suspending USDC:USD conversions over the weekend

#168

Post by SilasX »

kersplody wrote: post #4

USDC is managed the Centre consortium, which was founded by Circle and includes Coinbase as a member. Circle held around $3.3 billion in Silicon Valley Bank, leading to a run on USDC which resulted in it trading for as little as $0.95 on some exchanges today (Mar 10, 2023). This represents around 30% of USDC's cash reserves and 7% of its total reserves. The balance of reserves are held in T-Bills, which are liquid an…

> Circle held around $3.3 billion in Silicon Valley Bank, leading to a run on USDC which resulted in it trading for as little as $0.95 on some exchanges today (Mar 10, 2023).

It dipped as low as .82 on Gemini. I used the chance to buy some to settle a debt denominated in USDC on Compound, though I haven’t yet paid it back because transaction fees on the ethereum network surged too.

DAI fell below .90 even though it’s so overcollateralized that even the 100% loss of SVB funds shouldn’t make it insolvent: https://news.ycombinator.com/item?id=35105876

>USDC Liquidity pools on other exchanges are becoming completely drained, pulling down the peg

Nit: liquidity pools (at least of the kind described in the link) are decentralized and don’t live on an exchange.

Re: Coinbase suspending USDC:USD conversions over the weekend

#169

Post by lxgr »

I wonder how banks being closed is impacting Coinbase's willingness/ability to redeem USDC for USD.

Since Coinbase can (at least in the US, to my knowledge) also not transfer any USD out on the weekend, shouldn't it be risk-free to take on any USD liability over the weekend, at least when considering USDC itself risk-free?

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