The Instability of Stablecoinsby@AnthonytXie
5,475 reads

The Instability of Stablecoins

tldt arrow
Read on Terminal Reader
Read this story w/o Javascript

Too Long; Didn't Read

Stablecoins claim to achieve price stability by pegging their own prices to stable assets like the USD. The promise of stability has led many to call stablecoins the “holy grail of cryptocurrencies’. But history has taught us over and over that currency pegs can break, and cause wide-spread catastrophe when they do. In this article, I will demonstrate the weaknesses and dangers of each of the 3 categories of stablecoins backed by real-world collateral. We need frequent professional audits to prove that the collateral is there because real world assets are not visible on the blockchain. Because collateral is not transparent, the stablecoin is weak to speculation.

Company Mentioned

Mention Thumbnail

Coins Mentioned

Mention Thumbnail
Mention Thumbnail
featured image - The Instability of Stablecoins
Anthony Xie HackerNoon profile picture


Anthony Xie

Receive Stories from @AnthonytXie

react to story with heart


. . . comments & more!
Hackernoon hq - po box 2206, edwards, colorado 81632, usa