2019 Complete StableCoin Guide 1/7

Chapter 1 Enjoy shorts from my book while of finishes the graphics! Kyle Rea cREAtiveCastleStudios What is a StableCoin? Definition Simply stated, Or, a global digital currency solely unrelated to a central entity. StableCoin’s make for practical usage of cryptocurrencies by allowing for secure, convenient transactions without the high volatility traditional cryptocurrencies hold. a StableCoin is a cryptocurrency pegged to another asset. History of StableCoins While Satoshi Nakamoto’s vision for Bitcoin to be used as electronic cash, the world’s first cryptocurrency is rarely used as a medium of exchange on a day-to-day basis. Rather, volatility and high fees make many cryptocurrencies impractical for daily transactions, therefore is used more as a long term investment. StableCoins offer all the benefits of cryptocurrency, including; cryptographic security ability to transfer assets digitally fast transactions The concept of the StableCoin officially appeared in the 2012 documentation attached to the first version of . The founders claimed protocol “ .” ( MasterCoin Master Coin Inc will allow the binding of cryptocurrency to a stable traditional asset A Brief History of Mastercoin ) It wasn’t until 2015, released the first full-fledged StableCoin. is backed and pegged 1 : 1 with USD. The following year a European analog created EURT. Tether Limited Tether or USDT January 2016, an platform contributor aimed to create the StableCoin, DAO. had tokens paying for different operations with . Criticism states this is not a StableCoin related to the asset not being gold, but with DigixDAO’s reputation and their digital version of gold. ethereum Digix DigixDAO DGD DGX 2018 brought nearly thirty StableCoin projects preparing for ICO and pre-ICO and many expect that number to exponentially increase in 2019. Purpose & Need The goals StableCoins attempt to accomplish. among cryptocurrency trading pairs in forex-style trades. Create stability Aim to in times of market instability. diversify portfolios Desire to be used for as effortlessly as fiat. daily transactions, Aide in of digital currencies. adoption Form a new, . better financial ecosystem Assist in by . investment predictions minimizing current cryptocurrency market volatility , protecting those plagued by hyperinflation. Provide global access to a stable currency In Photo; Tyler Winklevoss. Cameron Winklevoss. StableCoin Advantages Benefits of Cryptoconomy. Low fees. Secure transactions. Somewhat or completely anonymous. . Stable Asset-backed. . Blockchain Technology Utilized This ledger system brings security, transparency and accountability. . Simple System is easy to understand for fiat and digital currency users. . Aids in Adoption Acceptable bridge from fiat to cryptocurrency use. . Smart Contracts Placed to protect all parties with interest in investments. . Regulations Fiat-involving processes involved. StableCoin Disadvantages . Centralized Defeats purpose of cryptocurrency. . Requires Third Party Requires trust from an entity. . External Audits Needed. To ensure assets are accounted for . Less Return on Investment Traders and investors look to other means for financial gain. . Lack of Education New technology and processes take time for mass adoption. . Regulations Fiat-involving processes involved. : Example StableCoins tied to real world assets such as; fiat, gold, corn, oil, sugar, diamonds, wheat, sugar. Stable asset-backed cryptocurrency makes a great digital currency for everyday use by any consumer. Particularly useful Examples; . Asset management made easy. Fixed Income Investments . Financial loans with benefits of ‘smart contracts’. Loan Payments Everyday transactions. Ordinary Payments. . Mortgages, rent, subscriptions. Recurring Payments Roger Ver Key Factors for Evaluating StableCoins When investing in a StableCoin, it’s wise to consider a few key factors; . If not completely decentralized, do users have access to audit the systems financial fundamentals to confirm collateral? Auditability ; Collateral defined; ‘To offer an asset as a surety that a debt will be repaid.” When ‘collateral’ or ‘collateralization’ is used in StableCoin’s terminology, it’s the asset the borrower leverages in order to secure a loan from issuer. What is the collateral behind StableCoin? Collateralization What are the procedures in the event of system failure? What happens to assets? What regulations protect the users? Fallback methods. . Does this ecosystem have stable stability? Growth . What is the overall costs? The ecosystem loses efficiency when high overhead costs and excessive fees exist, thus risking market fluctuation. Maintenance ; StableCoins are often ‘pegged’ by an entity. Investopedia states, “Pegging is a central bank’s open market operations meant to stabilize its country’s currency to that of another country by fixing its exchange rate.” Pegging ; Users are not always able to redeem their token exchange for underlying asset, one should know this before investing. Redeemability . What is the underlying reason this is a stable investment? What guarantees and risks exist? Stability methods . If on a centralized system, are ledgers open and viewable by users? Transparency Where to Find Stability; “Quantity Theory of Money” Many StableCoin White Papers state their cryptocurrency is designed based off ‘ ’ to control currency supply with a goal of maintaining price stability. The Quantity Theory of Money The infographic shown is termed ‘ . Irving Fisher and. Milton Friedman developed this equation in the 20th-century based off the popular orthodox theory by 17th-century classical economists, “ The Fisher Equation” Quantity Theory of Money” Simply; Money Supply multiplied by Velocity of Circulation is equal to; Price level multiplied by Transaction volume. (M x V = P x T ) If M doubles while V and T remain constant, then P theoretically will double; therefore the value of each individual unit of currency will be cut in half. Majority of notable economists accept ‘ ” as valid over long-term use. Therefore, with this pre 17th-century theory in mind, economists state StableCoins will maintain price stability by increasing or decreasing money supply. The Fisher Equation StableCoin’s can remain stable based on this concept because, if the cryptocurrency’s value drops below a certain price point, its users drive the crypto to be scrapped, decreasing the total supply of tokens, which stabilizes its value. If the token’s value rises beyond a certain price point, users incorporate more supply to keep cryptocurrency at fair market value. Being an aged theory, there’s some problems with “ .” An example being; V and T are assumed to be constant for the long term. Consequently, M and P are perfectly proportional. An intelligent design was in mind, as this theory was developed based on an advanced economic structure which assumes money velocity and transaction would be consistent. , blockchain projects are rapidly changing and the technology is in its infancy, therefore it’s difficult to calculate token velocity and transaction volume, and assume they’d be constant. Considering V and T as variables, it may be time to add more variables to ‘ . The Quantity Theory of Money However The Fisher Equation” Criticisms & Quotes , in a 2014 article states, “ “ Vitalik Buterin Ethereum Are stable-value assets necessary ? Given the high level of interest in “blockchain technology” coupled with disinterest in “Bitcoin the currency” that we see among so many in the mainstream world, perhaps the time is ripe for stable-currency or multi-currency systems to take over. There would then be multiple separate classes of cryptoassets: stable assets for trading, speculative assets for investment, and Bitcoin itself may well serve as a unique Schelling point for a universal fallback asset, similar to the current and historical functioning of gold. Miko Matsumura EvercoinNews Miko Matsumura UC Berkeley’s Computer Security Researcher, wrote StableCoin Tether is “ .” Nicholas Weaver the primary vehicle for hiding money flows by allowing customers to switch between different cryptocurrencies. In short, they represent a significant problem , founder of , wrote, “ Later stating, StableCoins are ” Preston Byrne Monax fiat-world examples of pegged assets form an object lesson in why you don’t try to peg currencies: because you are unable to hold the peg any longer than you can afford to subsidize your differences of opinion with the market.” “the techno-magical idea that a cryptocurrency can tell the market what its price should be, rather than the market determining what a cryptocurrency’s price should be. “ Distributed StableCoins aim to achieve both the characteristics of crypto-coins like Bitcoin (censorship resistant digital transactions) and the price stability of traditional financial assets, such as the US Dollar or gold. These systems are distinct from tokens such as Tether, where one entity controls a pool of US Dollar collateral, ultimately making the system centralised and thus susceptible to being shut down by the authorities.” Matthew Leising Everipedia Szabo stated central banks could soon turn to cryptocurrencies to shore up reserves, reports Jan. 9, 2019. “ Nick Finance Magnates There’s going to be some situations where a central bank can’t trust a foreign central bank or government with their bonds for example. One solution that’s been developed is to have the Swiss government hold it for you — that’s not a trust minimised solution. The Swiss government itself is subject to political pressures and so a more trust minimised solution is cryptocurrency.” “ and ( ) bulls and founders of the cryptocurrency trading platform , have said . The twins made their remarks during an interview on crypto-focused news segment on Jan 14, 2019… ”released on January 14, 2019. Tyler Winklevoss Tyler Winklevoss Bitcoin BTC Gemini stablecoins and tokenized securities will usher in a bright future for the digital currency space Fortune’s The Ledger Cameron further noted that with at least 60 percent of $100 bills now held overseas, dollars on the blockchain are poised to significantly reshape the global currency market. cointelegraph Types of Stablecoins: Asset-Collateralized vs. Non-Collateralized Define Asset-Collateralized StableCoins. The socially agreed upon currency most countries use is termed ‘ ’, which literally means ‘ Until 1971 world currencies were backed by gold. Before printed money; diamonds, silver, gold, land, estate and other goods were used as means for barter. Shifting from an asset backed currency to the current fiat system left centralized banks, governments, financial technologists, private entities, and economic experts with the concept of . These specific StableCoins’ purpose is to tokenize stable assets on a blockchain serving as a digital currency for means of speedy, secure and stable daily transactions. Stablecoins in this category guaranteed to exchange 1 : 1 StableCoin for its underlying asset. fiat something that was created without effort.” Asset-Collateralized StableCoins should be Define Non-Collateralized StableCoins. One argument states, fiat is not backed by any tangible asset, therefore; why should cryptocurrency only have value as an asset-backed currency? An opposing argument suggests currency merely must have an agreed upon “value” to be successful. were created as a medium. . The only current noted approach is the Non-Collateralized Stablecoins This category of digital currency is not backed by any “real-world” or cryptocurrency asset; but instead, maintains value by its users expectations of maintaining a certain value Non-Collateralized Seigniorage Supply (Algorithmic) StableCoin Model. Each Category Broken Down I’m releasing shorts of my ebook on each section. I’ve separated StableCoins into three different categories. three are one is and the remaining group is a category. This is in hopes of a more simplistic understanding for us all. , Asset-Collateralized Non-Collateralized Hybrid First My publication is . Asset-Collateralized StableCoins, Fiat-Collateralized . Medium here Second, . That article can be viewed . Crypto-Collateralized StableCoins here We then switched things up a bit and visited the only Category, . Enjoy the description of the futuristic currency model . Non-Collateralized StableCoin Seigniorage Supply (Algorithmic) StableCoin Model here Next was a simple to understand category among a group; with a long list of promising projects found . Asset-Collateralized Metal-Collateralized Stablecoins here Stay tuned for more updates! If you’ve found this article helpful and would like to donate to our work towards decentralized education, ETH accepted here: 0xF32Cc9FBA17F389f734e7aACACDFb39ba7029c18 End. Part 1/10 of Alyze Sam’s 2019 Complete StableCoin Guide This concludes the small ‘short’ from an upcoming E-book. Stay tuned for more, and help a lady trying to serve the Women In Blockchain and The Tech News community out. How? Tell me what you think. I’ve been a hospice nurse for the last 11 years! What am I ? missing What would you ? add What’s on StableCoins? your personal opinion (probably not! Haha!) Am I working this Hackernoon thing correctly I’d love to professionally discuss, collaborate and connect with you all. , positive and negative; as I’m only here to improve and educate myself/others. Would love any feedback So, how can we mutually benefit one another? 💻 Let’s Connect on Social Media 📱 -@ LinkedIn -@ instagram -@ Facebook -@ Twitter Special thanks to my new BFF and fellow Rick Sanchez C137 nerd, . Matthew You can find this brilliant goofball ball giving away free education in these locations; -@ LinkedIn -@ instagram -@ r Twitte Matthew Bardeleben What’s to come? Who’s going to be in sunny San Francisco, CA the last week of March? I will be speaking at the @blockchainSoTO Exec-Only SF Conference on March 27th at @DeloitteUS! w/ @Securitize @DispatchLabsIO @Truebitprotocol @Aperture_RE & more! This is a private event, but if you’re interested, give me or the TheBlockchainSociety.ca a shout out.(I’ll give you a 50% off coupon!) I hope you’ll tune in. Wes Williams, Kyle Rea and I are “road tripping” together. Filming. This will be fun for everyone. Hehe , , , , , , Deloitte Gov Dispatch CoinList Coin and Crypto CryptoCentral.io Aegis Jakub Deloitte Digital US Sources https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ www.cointelligence.com/content/stablecoins-guide/amp/ www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ https://blog.bitmex.com/https://www.cointelligence.com/https://www.cointelligence.com/content/stablecoins-guide/amp/ _'Stablecoins' are the hottest thing in crypto right now, with over 50 projects in development. A 'stablecoin' is a…_www.google.com The crypto world is going wild for 'stablecoins' - here's everything you need to know about them https://www.google.com/amp/s/amp.businessinsider.com/crypto-stablecoins-explained-bitcoin-ethereum-fintech-2018-9 _The Stablecoin Index is an open-source tool to track and compare various stablecoin projects._stablecoinindex.com Stablecoin Index https://stablecoinindex.com/projects/ _Stablecoins have proliferated this year, so much so that it's been hard to keep track of them all. In a bid to remedy…_news.bitcoin.com A Complete A-Z of Stablecoins - Bitcoin News https://news.bitcoin.com/a-complete-a-z-of-stablecoins/ _Today, Gemini launched the Gemini dollar. This cryptocurrency is pegged to the dollar, but built on the blockchain so…_www.forbes.com Why You Should Avoid Stablecoins As Investments https://www.forbes.com/sites/simonmoore/2018/09/10/why-you-should-avoid-stablecoins-as-investments/amp/ _What Are Stable Coins? Full List & Guide Quick inner navigation: The crypto industry has really grown in the past three…_www.abitgreedy.com What Are Stable Coins? Full List & Guide - aBitGreedy https://www.abitgreedy.com/stable-coins/ _Stablecoins are quickly becoming the holy grail in cryptocurrency, promising both a safehaven where value can be stored during volatile…_medium.com The Top 6 Stablecoins in Crypto https://medium.com/@kingsleyadvani/the-top-6-stable-coins-in-crypto-e6f53e9b03be _We all HODL cryptocurrencies, don't we? But have you ever tried spending them on goods and services without a second…_coinsutra.com What Are Stablecoins? Are They Really The Solution? https://coinsutra.com/stablecoins/ _Talk about an exciting crypto type is what got me to writing this article. The USP of this type of crypto is that unlike…_coinsutra.com The Best Available Stablecoins In The Crypto Market https://coinsutra.com/best-stablecoins/ _Stablecoins have proliferated this year, so much so that it's been hard to keep track of them all. In a bid to remedy…_news.bitcoin.com A Complete A-Z of Stablecoins - Bitcoin News https://news.bitcoin.com/a-complete-a-z-of-stablecoins/ _The current wave of stablecoin issuances is a result of the current bear market in underlying crypto assets, leading to…_www.coindesk.com 2019 Will Be a Big Year for Stablecoins - CoinDesk https://www.coindesk.com/2019-will-be-a-big-year-for-stablecoins _'Stablecoins' are the hottest thing in crypto right now, with over 50 projects in development. A 'stablecoin' is a…_www.businessinsider.com The crypto world is going wild for 'stablecoins' - here's everything you need to know about them https://www.businessinsider.com/crypto-stablecoins-explained-bitcoin-ethereum-fintech-2018-9 https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f https://en.m.wikipedia.org/wiki/Stablecoinhttps://medium.com/makerdao/part-3-the-strengths-weaknesses-of-stablecoins-62f13b592e3f _Read all of the posts by Robert Sams on cryptonomics_cryptonomics.org Robert Sams https://cryptonomics.org/author/paralogical/ _After a meteoric 1,300%+ run in 2017, bitcoin and other altcoins are widely considered speculative assets. But for many prophetic crypto…_hackernoon.com How to make a “stablecoin” stable? https://hackernoon.com/how-to-make-a-stablecoin-stable-cf105ca2c708 _This guide takes a look at the different types of stablecoins in the cryptocurrency market and its importance in the…_masterthecrypto.com Guide to Stablecoin: Types of Stablecoins & Its Importance https://masterthecrypto.com/guide-to-stablecoin-types-of-stablecoins/ _Stablecoins have been one of my major areas of interest since I got involved in crypto. I first learned of Bitcoin when…_multicoin.capital An Overview Of Stablecoins - Multicoin Capital https://multicoin.capital/2018/01/17/an-overview-of-stablecoins/ _When merchants started introducing bitcoin and similar digital currencies as one of their payment methods, they quickly…_www.ccn.com Crypto Industry is Betting Big on the Future of Stablecoins https://www.ccn.com/crypto-industry-is-betting-big-on-the-future-of-stablecoins/ _VariabL CCO Nathan Sexer undertakes an exhaustive study of stable digital assets and explains why they’re essential to the emerging…_media.consensys.net State of Stablecoins, 2018 https://media.consensys.net/the-state-of-stablecoins-2018-79ccb9988e63?gi=e708a7d5fec8 _Special thanks to Robert Sams for the development of Seignorage Shares and insights regarding how to correctly value…_blog.ethereum.org The Search for a Stable Cryptocurrency https://blog.ethereum.org/2014/11/11/search-stable-cryptocurrency/ _Price swings that would be deemed as catastrophic in traditional equities markets happen on a daily basis in the…_coindiligent.com Analyzing the 4 types of stablecoins - CoinDiligent https://coindiligent.com/analysis-types-of-stablecoins _A stablecoin is a cryptoasset with a mechanism in place to keep the price stable. Given the volatile nature of…_coincentral.com Understanding the Three Types of Stablecoins https://coincentral.com/types-of-stablecoins/ _Cryptocurrency pioneer Nick Szabo has argued that amidst rising geopolitical uncertainty, central banks could soon turn…_cointelegraph.com Crypto Trailblazer Nick Szabo: Central Banks Could Turn to Crypto to Support Reserves https://cointelegraph.com/news/crypto-trailblazer-nick-szabo-central-banks-could-turn-to-crypto-to-support-reserves _Tyler and Cameron Winklevoss have said stablecoins and tokenized securities will usher in a bright future for the…_cointelegraph.com Winklevoss Twins Believe Stablecoins, Tokenized Securities Are Future of Crypto Innovation https://cointelegraph.com/news/winklevoss-twins-believe-stablecoins-tokenized-securities-are-future-of-crypto-innovation _Bitcoin is a cryptocurrency built on blockchain distributed ledger technology. Bitcoin is a peer to peer electronic cash…_bitcoinexchangeguide.com Bitcoin Exchange Guide: Blockchain News & Cryptocurrency Reviews https://bitcoinexchangeguide.com/ Bitcoin Forum - Indexbitcointalk.org Bitcoin Forum - Index https://bitcointalk.org/ bit.ly Careers in Blockchain and tech - BlockSparks http://bit.ly/2OhSm0Z _The latest news about Bitcoin, Ethereum, XRP and cryptocurrencies, Blockchain Technology, ICO, STO, FinTech, Internet of…_www.coinspeaker.com Coinspeaker - Blockchain, Cryptocurrencies, Fintech, ICO, STO and Internet of Things News. https://www.coinspeaker.com/ _The most recent news about crypto industry at Cointelegraph. Latest news about bitcoin, ethereum, blockchain, mining,…_cointelegraph.com Latest Bitcoin, Blockchain and Ethereum news https://cointelegraph.com/ _Keep up with real-time market data on the new crypto-economy in order to make better investment decisions._www.cointelligence.com Cointelligence - The data layer of the crypto economy https://www.cointelligence.com/ https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins https://github.com/ethhub-io/ethhub/tree/master/built-on-ethereum/open-finance/stablecoins _Stock Market Basics Want to know how the stock market really works? This guide will teach you the basics. Best Brokers…_www.investopedia.com Sharper Insight. Smarter Investing. https://www.investopedia.com _Wikipedia is a free online encyclopedia, created and edited by volunteers around the world and hosted by the Wikimedia…_www.wikipedia.org Wikipedia https://www.wikipedia.org/