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Report on Stablecoins [pdf]

home.treasury.gov

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Re: Report on Stablecoins [pdf]

#551

Post by icelancer »

lentil_soup wrote: post #298
icelancer wrote: post #253

Earlier quoted context omitted.

I've responded to several commenters who say this with my real world examples, the most notable of which are paying people in Venezuela to do work for me when most mainstream forms of monetary exchange are nearly impossible in/out of that country.

Venezuelan here. You're exaggerating the use of bitcoin in Venezuela. You might have paid some people with it but on the streets you use and want USD. Zelle, PayPal or USD in cash. No one wants another volatile currency, we've had enough of those.

I am, uh, paying two contractors in Venezuela in cryptocurrency (not BTC) by their request. Not sure how I'm exaggerating it. Unless you think I'm only paying one contractor, I guess.

Re: Report on Stablecoins [pdf]

#552

Post by lentil_soup »

werdnapk wrote: post #361
lentil_soup wrote: post #298

Earlier quoted context omitted.

Venezuelan here. You're exaggerating the use of bitcoin in Venezuela. You might have paid some people with it but on the streets you use and want USD. Zelle, PayPal or USD in cash. No one wants another volatile currency, we've had enough of those.

Is it true that parts of Venezuala are using flecks of gold as currency? Or is that just highly localized in usage and/or mostly in remote areas?

I have not heard of that to be honest. What does happen is you might settle change with random stuff. Say you buy groceries for $8.50. You might pay half with a transfer in bolivares (local currency) and the rest with a $5 bill. Then they'll give you back a chocolate and a bar of soap as change as they might not have enough. It's bizarre

Re: Report on Stablecoins [pdf]

#553

Post by swader999 »

arcticbull wrote: post #533
stickfigure wrote: post #526

Earlier quoted context omitted.

Sure, but the issue is not demand but supply. Enforcing the scarcity of USD requires a large military. Enforcing the scarcity of BTC merely requires electricity.

It merely requires massive amounts of electricity and e-waste vastly disproportional to its benefit and proportional to its price. Don't mince words.

Proof of stake is just a fork that'll happen whenever there's enough force applied by the power providers.

This excess low cost energy that can't be moved easily to other areas is often the only kind of energy bitcoin can use to win the economics of btc mining. It in fact subsidizes a lot of green energy and makes it more viable in the longer term.

Re: Report on Stablecoins [pdf]

#554

Post by ButtSpark69 »

Animats wrote: post #47

This is good. The backing of stablecoins is a very real issue. As the Treasury points out, there's a very real possibility of a run. Two stablecoins have crashed so far, SafeDollar SDO, and $TITAN. They went all the way to zero. Can Tether survive a net outflow? Probably not. They don't have the collateral. Dai is really a derivative of Etherium. Dai is backed by Etherium at 150%. So value in Dai is at risk if the pr…

Survived the 90%+ drop about 4 years ago. I don't know if it's backed or not, but it means something.

Re: Report on Stablecoins [pdf]

#555

Post by ButtSpark69 »

arcticbull wrote: post #218
mattnewton wrote: post #185

Earlier quoted context omitted.

I'm a crypto bear myself, but I'm not sure I agree with this argument. Plenty of services are built around "just moving money around" - accounting in this way has a ton of real value or else stripe, visa, paypal etc wouldn't be the huge companies they are. The questions are, whether "investing" by buying and holding is the right way to capture the value that this produces, and whether the benefits of doing it on a di…

That's not quite correct, although I understand your sentiment. When you own a share of Square (or Visa, or PayPal) each time a transaction takes place on their network, a portion of that transaction (revenue minus costs) accrues to the company - and by extension increases the intrinsic value of your share. The transaction revenue is spent on furniture, on R&D, on employees and on buffing up their cash position. As a…

As an Eth staker I get paid for a portion of every transaction that the network processes.

Re: Report on Stablecoins [pdf]

#556

Post by gnopgnip »

krick wrote: post #450
roywiggins wrote: post #398

Earlier quoted context omitted.

Oh, I understand why it hasn't collapsed already. I just don't see how Tether refusing to honor redemptions makes it more resilient to a run in progress, rather than less . If nobody wants to buy 1 USDT for a dollar, the peg will break all the same. If Tether stepped in as a buyer of last resort, that would make it more resilient- but if it doesn't, that worse for the peg, not better. It's better for anyone with phys…

> Oh, I understand why it hasn't collapsed already. I feel stupid, but I still actually don't. If considerably more people will want to sell it than there is a demand for it, the price will have to go down, no matter what, as long as "price" is anything more than a decorative label on the exchange's website and you actually can swap it for any currency at all. So, either the exchange should cover all that demand, whi…

While crypto prices are rising generally there are more people putting money in and fewer people taking money out. Even a short shift in the market isn't enough to change that.

But a longer term crypto recession would have a run on the exchanges, many would want to cash out, and the price isn't going to be stable

Re: Report on Stablecoins [pdf]

#557

Post by TrackerFF »

epinephrinios wrote: post #360
mailbag wrote: post #85

Earlier quoted context omitted.

Arguably, we've already seen multiple catastrophic crashes in cryptocurrencies.

And the market rebounded without a government bailout.

...and that's the dilemma. Did the market rebound because there's a organic growth of buyers, or did printing tethers out of thin air help this?

Re: Report on Stablecoins [pdf]

#558

Post by SturgeonsLaw »

creeble wrote: post #428
RustyConsul wrote: post #325

Earlier quoted context omitted.

Do you think we will forever be organized and segregated by governments? Do you ever think a human being can be a sovereign individual in his own right, without owing fealty, taxes and morality to a government in some future? The current financial system is not all software. When i pay in crypto, i give you my money. When i pay in the current financial system I am giving you every bit of information to rob me blind a…

And once again, we arrive at the real definition of cryptocurrency: It's not a currency, or financial system, it's a counterpoint to democracy.

Good, a bit of competition works out better for the end user. Political systems tend to be a monopoly, and monopolies lend themselves to abusive practices.

Re: Report on Stablecoins [pdf]

#559

Post by bradwood »

Animats wrote: post #47

This is good. The backing of stablecoins is a very real issue. As the Treasury points out, there's a very real possibility of a run. Two stablecoins have crashed so far, SafeDollar SDO, and $TITAN. They went all the way to zero. Can Tether survive a net outflow? Probably not. They don't have the collateral. Dai is really a derivative of Etherium. Dai is backed by Etherium at 150%. So value in Dai is at risk if the pr…

> The real question is what happens in the next recession

A massive inflow of capital to crypto, bitcoin in particular.

Re: Report on Stablecoins [pdf]

#560

Post by hef19898 »

arcticbull wrote: post #290
Animats wrote: post #47

This is good. The backing of stablecoins is a very real issue. As the Treasury points out, there's a very real possibility of a run. Two stablecoins have crashed so far, SafeDollar SDO, and $TITAN. They went all the way to zero. Can Tether survive a net outflow? Probably not. They don't have the collateral. Dai is really a derivative of Etherium. Dai is backed by Etherium at 150%. So value in Dai is at risk if the pr…

> Can Tether survive a net outflow? Probably not. They don't have the collateral. Luckily for Paolo & friends, their terms of service clearly state that they do not ever have to offer redemptions of USDT for dollars. Or even whatever IOUs and bits of string they may or may not have in reserve. Out of all the stable coins its the most likely to withstand a "run" because they do not have to pay you if you ask. In fact…

So in a sense the guys behind Tether seem to be pretty conscious and smart about what they do. Would be curious to see that playing out in court so.
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