Coinbase is launching support for the USDC stablecoin • Hacker News Board

Re: Coinbase is launching support for the USDC stablecoin

#301

Post by anders94 » Tue, Oct 23, 2018, 11:41 PM UTC

jdoliner wrote: post #212

anders94 wrote: post #197

Earlier quoted context omitted.

Circle holds one dollar for every dollar minted, we do not run a fractional reserve. The CENTRE Consortium holds minters (of which Circle is one) to strict auditing requirements. While this information is regularly published, you can see all minting and burning operations (as well as all transfers and other token operations) in realtime on the Ethereum blockchain. See etherscan: https://etherscan.io/address/0xa0b8699…

Thanks for the quick answer, this all makes sense. Does this get limiting at all, in terms of wanting to mint new coins and not having the capital to do so?

It isn't limited like that.

As you can imagine, Circle maintains fairly sophisticated minting operations able to execute around the clock. All that is necessary for coins to be minted is for Circle to broadcast a properly signed transaction.

Now, of course, Circle can't just mint a limitless supply because we have a minting allowance set by CENTRE. While CENTRE itself can't mint coins, they do operate a minting allowance system with around the clock availability which can grant Circle a additional allowance per a ruleset to effectively manage risk.

This might seem to be getting into the weeds a bit but support for multiple minters (Circle and Coinbase here for example) is a significant differentiator between USDC and other reserve backed stablecoins.

Re: Coinbase is launching support for the USDC stablecoin

#302

Post by mehmeta » Tue, Oct 23, 2018, 11:50 PM UTC

QML wrote: post #295

chemmail wrote: post #281

Earlier quoted context omitted.

The problem with stablecoins, there is no such thing as a stable coin.

Whats the difference between a stablecoin and an IOU?

Both fiat backed assets as well as collateralized assets pegged to fiat money are called stablecoins, because they are meant to represent units of fiat money, and therefore "stable" relative to fiat. Fiat backed stablecoins fit the definition of an IOU better, since they are cryptographic promises to pay the bearer by centralized issuing entities. Whereas collateralized stablecoins are not IOUs, they are effectively loans on other cryptoassets you deposit in a smart contract (ether, in Maker/Dai's case).

Re: Coinbase is launching support for the USDC stablecoin

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Post by paulgrant999 » Tue, Oct 23, 2018, 11:52 PM UTC

nostrademons wrote: post #267

asynchrony wrote: post #254

Earlier quoted context omitted.

I can definitely see the attraction for entrepreneurs, just not the value for anyone else.

It's a form of time-arbitrage. The cost of regulation is a decrease in both convenience and innovation. By eliminating regulation, you get a whole host of new startups that were previously held back, some of which solve genuine problems that have no existing solution. Consumers flock to these startups because right now, in this moment , they solve problems better and are more responsive to customers than the existing…

time-arbitrage, another word for "stupidity".

Re: Coinbase is launching support for the USDC stablecoin

#304

Post by antidesitter » Tue, Oct 23, 2018, 11:52 PM UTC

hudon wrote: post #188

lawn wrote: post #146

Earlier quoted context omitted.

> but you can’t trade anywhere Just trade on all the other less regulated exchanges. Or localbitcoin. Or, you know, buy stuff. > and speculation is crypto’s only use case today. Or you buy stuff... For example: * Webhallen (huge Swedish online shop) * scan.co.uk (uk based computer online shop) * purse.io (buy stuff from amazon) * fastmail (emails) * VPN/VPS/domains from various providers * darknetmarkets

Why the hell would I buy Bitcoin to buy stuff on Amazon through a proxy site that sells my BTC for me instead of just... buying on Amazon like a normal person? BTC will be way slower and more expensive than just using my credit card... Plus Visa will refund me in the case of fraud. Like I side, speculation is the only thing you buy BTC for (moon!!!111), and the exchanges will prevent you from doing this if you are re…

> Like I side, speculation is the only thing you buy BTC for

You've ignored the rest of the list in the comment you’re replying to.

Re: Coinbase is launching support for the USDC stablecoin

#305

Post by paulgrant999 » Tue, Oct 23, 2018, 11:53 PM UTC

Permit wrote: post #11

Stablecoins seem like they would achieve most of the goals of the original cryptocurrencies such as Bitcoin: - Decentralized transactions - 24/7 access - Low fees - Store of value I suppose the only drawback here is that they're issued from a centralized authority. That said, for practical purposes the vast majority of Bitcoin holders didn't mine their own coins either. Despite this, no one on Twitter[1] seemed excit…

you know why banks are so heavily regulated?

a distributed systems of ledgers, where banks attested to the amount of cash, in their vaults.

... ... ...

Re: Coinbase is launching support for the USDC stablecoin

#306

Post by sitepodmatt » Tue, Oct 23, 2018, 11:57 PM UTC

There is a lot of negativity on this but it must be more preferable to the Tether train wreck, the backing alone of Circle and Coinbase puts this on another level in terms of legitimacy. There is certainly a market for it, given there's 2billion of Tether in ~circulation (although who knows how much is actually backed by US$).

Re: Coinbase is launching support for the USDC stablecoin

#307

Post by wcarron » Tue, Oct 23, 2018, 11:59 PM UTC

billions wrote: post #95

wcarron wrote: post #34

Earlier quoted context omitted.

What a strawman. Inflation BAAAAAD, right guys? C'mon. We all know why the Fed targets a relatively consistent rate of inflation. It's because deflation suppresses consumer spending. Not what you want in a consumer economy.

"What a strawman." -@wcarron Below is a list of 590+ failed fiat currencies, 150 caused by hyperinflation. Seems the Straw Man argument is yours alone. https://trader2trader.co/tag/historic-graphs/page/3/

This is hardly worth dignifying with an answer, but I will anyway. Your original premise was that the dollar has lost enormous value since 1913. Strongly implicating the inflation is a measure by which you can measure whether or not a currency is "failed". This is false. A dollar or any unit of currency is an arbitrary symbol of a certain amount of worth.

Inflation does mean that the spending power of a currency decreases. No argument there. But guess what! Wages increase(d) relatively in line with inflation. If a snickers bar used to be $1 when the average salary was $10000; and now it's $2 when the average salary is $20000, then the actual cost of a Snickers bar has not changed, in simplified terms. I see no problem here. It also intuitively makes sense, that as the population of capital producing workers grows, so too does the GDP. These people need currency issued, too, otherwise, the currency would be deflationary. So new currency is issued to prevent deflation (just 1 example of why it's issued) and keep the currency in circulation in line with production.

> 150 caused by hyperinflation.

Like, for example, the Bolivar? or the Mark? That's actual hyperinflation. ~2% inflation YoY doesn't mean hyperinflation. This is Econ 101.

Re: Coinbase is launching support for the USDC stablecoin

#308

Post by sitepodmatt » Wed, Oct 24, 2018, 12:02 AM UTC

nickthemagicman wrote: post #225

Is there like a large bank account somewhere that will hold al the 'dollars' backing the billions of USDC? How is this implemented?

That's the idea, but previous stable coins have had trouble proving such and met a lot of community rejection (deservedly).

Re: Coinbase is launching support for the USDC stablecoin

#309

Post by wyldfire » Wed, Oct 24, 2018, 12:25 AM UTC

lacker wrote: post #105

Permit wrote: post #11

Stablecoins seem like they would achieve most of the goals of the original cryptocurrencies such as Bitcoin: - Decentralized transactions - 24/7 access - Low fees - Store of value I suppose the only drawback here is that they're issued from a centralized authority. That said, for practical purposes the vast majority of Bitcoin holders didn't mine their own coins either. Despite this, no one on Twitter[1] seemed excit…

Another key drawback of USDC is that your account can be frozen by the centralized authority: USDC tokens are ERC-20 compatible and can be used with any ERC-20 compatible digital wallet. However, a global blacklist is maintained by CENTRE for USDC, which prevents tokens from being sent into or from blacklisted addresses. Reasons for blacklisting could include known fraudulent or illegal activity, or a legal order or…

'key drawback' aka a centralized system.

Re: Coinbase is launching support for the USDC stablecoin

#310

Post by loeg » Wed, Oct 24, 2018, 12:26 AM UTC

sgondala2 wrote: post #271

loeg wrote: post #207

Earlier quoted context omitted.

Traders, including HFT, are incentivized by the underlying value to keep the bid/ask spread very tight.

Isn't this the same for any coin? Is making a stable coin as simple as naming it a 'stable' coin ?

You could ask the same question about any security. Yes, traders in general are incentivized to bid/ask near the actual value of the underlying security.

The difference between securities in the abstract and a trustworthy, 100% reserve stablecoin is that the value of the latter is both known ($1) and stable (at least in USD terms).

Yeah, stablecoins really are as simple as naming it a stable coin and pledging 100% real currency backing, so long as you can convince traders you are trustworthy. E.g., I have some confidence Coinbase is trustworthy; I have zero confidence Bitfinex is trustworthy.