Stablecoins are not stable (they cannot be due to counterparty risk) or coins (centralized trust).
There are actual problems that need to be solved in the space.
You could be working on research into scaling trustless systems; into UX design for trustless wallets; better hardware wallet design; and so on and so forth.
Instead, you've created a crappy inefficient form of the US Dollar and you're pumping it to make money in trading fees.
Tether became a fundamental component of the crypto ecosystem by allowing crypto / fiat trades and price discovery without needing routine access to the legacy banking system. USDC, GUSD, etc. are trying to replace Tether by accomplishing the same thing without the baggage and distrust of Tether. There may be core risks of asset-backed stablecoins but compared with everything else in the ecosystem they are much more reliable.
I'm working on a stable coin project right now (unsurprisingly almost all of the time and costs are process and regulation).
And yeah, it relies on centralized trust for issuance, so it's hard to call it a "coin" in the same way bitcoin is, but I do believe it solves real problems.
There's a lot you can do with a collateralized-cryptographic-asset-on-a-distributed-ledger (or stablecoin) that you can't do with a bank account. For one thing, you can write your own wallet app that works however you want it. That would be like if all banks implemented the same standard, and you could use any app to control your accounts.
You can use it to do some interesting things, like write apps that require two-to-sign for certain types of transactions, or write a generic two-factor auth that works with any of these apps. You could write an arbitration service for settling disputes, or do actual (less than 10 cents) micro-transactions since the processing fees are fractions of a cent.
There's a lot of potential from letting programmers interact with the finance system more concretely, and that's the problem at least some of these stablecoins are trying to solve. Not Gemini, but over on the stellar network that's what we're working on.
Price stability is as big a barrier to adoption as speed and end-user experience are. Discrediting or wilfully misleading the public on that point is harmful to the field as a whole.
Of all the things to work on in blockchain that are more interesting than an IOU coin, the best you could come up with was wallet UX and hardware wallet design?
Am I the only person who struggles with the idea of anything that's set at 1-to-1 with a single fiat currency being called 'stable'?
Certainly, USD is more stable than BTC or ETH, so a "stablecoin" pegged to it will share that increased stability. But that's more a question of prevailing economic conditions than anything, and there's nothing stopping a fiat-based coin from sharing in the inflation, deflation, or collapse of the pegged currency. Even if we assume the implementation of the currency perfect, you're just changing the set of things your currency is vulnerable to.
I wonder if anybody's working on a Stablecoin which tries to mitigate this using something like precious metals, or a pool of fiat currencies (with the understanding that something hitting USD hard might not hit CNY or EUR or GBP as hard, mediating the effect).
Yes to both. There are at least two gold-backed cryptocurrencies designed for a strict interpretation of Islamic Finance (HelloGold in Malaysia, OneGram in Dubai).
There is also a basket of 15 currencies plus gold, called Globcoin, though the balance of currencies, what currencies you could buy and sell Globcoins with, and relative share of each coin was difficult to interpret when I was looking into it.
iirc, MakerDAO was originally going to peg itself to the IMF's SDR, which is a basket of multiple currencies regularly rebalanced to achieve "universal" stability[1].
They then decided to peg to the USD to please traders, who measure in USD. But I understand it's indeed a long term goal to peg to a more stable asset. The underlying mechanism should stay the same.
This is why crypto is so attractive to libertarians.
It requires getting something for absolutely no effort and conflates economic growth with semantic labeling of abstract pseudo academia aimed at the very people whom they are trying to steal money from.
Somebody needs to put together a "Wall of Shame". History will teach us as this period as a "Dark Period" where financial scammers flourished with the help of Russia to launder the very money they took from their people.
>Bitcoin is digital gold, even if economists hate it. Humans around the world started believing in a deflationary currency.
>Centralized non-stable coins took advantage of noobs that didn't understand the purpose of blockchain was to be decentralized.
>Smart coins failed to scale, and might be seeing their end. POS and DAG are untested solutions that might provide a future, but it will be years before people trust it.
>Stable coins are centralized, but provide the ability to transfer assets with limited costs. These will require centralization
>Fast/cheap/privacy coins are looking to beat bitcoin at moving money.
That said, just because a crypto is useful, doesnt mean that it will grow in value. The value may be using the coin rather than holding the coin.
[+] [-] esotericn|7 years ago|reply
Stablecoins are not stable (they cannot be due to counterparty risk) or coins (centralized trust).
There are actual problems that need to be solved in the space.
You could be working on research into scaling trustless systems; into UX design for trustless wallets; better hardware wallet design; and so on and so forth.
Instead, you've created a crappy inefficient form of the US Dollar and you're pumping it to make money in trading fees.
Is that... fun?
[+] [-] seibelj|7 years ago|reply
[+] [-] traverseda|7 years ago|reply
And yeah, it relies on centralized trust for issuance, so it's hard to call it a "coin" in the same way bitcoin is, but I do believe it solves real problems.
There's a lot you can do with a collateralized-cryptographic-asset-on-a-distributed-ledger (or stablecoin) that you can't do with a bank account. For one thing, you can write your own wallet app that works however you want it. That would be like if all banks implemented the same standard, and you could use any app to control your accounts.
You can use it to do some interesting things, like write apps that require two-to-sign for certain types of transactions, or write a generic two-factor auth that works with any of these apps. You could write an arbitration service for settling disputes, or do actual (less than 10 cents) micro-transactions since the processing fees are fractions of a cent.
There's a lot of potential from letting programmers interact with the finance system more concretely, and that's the problem at least some of these stablecoins are trying to solve. Not Gemini, but over on the stellar network that's what we're working on.
[+] [-] decentralised|7 years ago|reply
https://github.com/jpantunes/awesome-cryptoeconomics#stablec...
That being said, there's a big difference between a pegged currency and an algorithmic stablecoin like the DAI or Bancor.
[+] [-] pavel_lishin|7 years ago|reply
No, but it is allegedly profitable!
[+] [-] leppr|7 years ago|reply
Ironic that you would quote that article yet completely ignore its meaning in the rest of your comment?
Stablecoins are a superset of centralized voucher tokens like Tether.
Research into trustless price-stable cryptocurrencies is an ongoing effort, which realization will have a huge impact on the crypto ecosystem.
https://news.ycombinator.com/item?id=18287231
Price stability is as big a barrier to adoption as speed and end-user experience are. Discrediting or wilfully misleading the public on that point is harmful to the field as a whole.
[+] [-] fembot__|7 years ago|reply
[+] [-] wanderfowl|7 years ago|reply
Certainly, USD is more stable than BTC or ETH, so a "stablecoin" pegged to it will share that increased stability. But that's more a question of prevailing economic conditions than anything, and there's nothing stopping a fiat-based coin from sharing in the inflation, deflation, or collapse of the pegged currency. Even if we assume the implementation of the currency perfect, you're just changing the set of things your currency is vulnerable to.
I wonder if anybody's working on a Stablecoin which tries to mitigate this using something like precious metals, or a pool of fiat currencies (with the understanding that something hitting USD hard might not hit CNY or EUR or GBP as hard, mediating the effect).
[+] [-] mopeloi|7 years ago|reply
There is also a basket of 15 currencies plus gold, called Globcoin, though the balance of currencies, what currencies you could buy and sell Globcoins with, and relative share of each coin was difficult to interpret when I was looking into it.
[+] [-] leppr|7 years ago|reply
They then decided to peg to the USD to please traders, who measure in USD. But I understand it's indeed a long term goal to peg to a more stable asset. The underlying mechanism should stay the same.
[1]: https://www.imf.org/external/np/exr/faq/sdrallocfaqs.htm
[+] [-] browsercoin|7 years ago|reply
It requires getting something for absolutely no effort and conflates economic growth with semantic labeling of abstract pseudo academia aimed at the very people whom they are trying to steal money from.
Somebody needs to put together a "Wall of Shame". History will teach us as this period as a "Dark Period" where financial scammers flourished with the help of Russia to launder the very money they took from their people.
[+] [-] mkirklions|7 years ago|reply
>Bitcoin is digital gold, even if economists hate it. Humans around the world started believing in a deflationary currency.
>Centralized non-stable coins took advantage of noobs that didn't understand the purpose of blockchain was to be decentralized.
>Smart coins failed to scale, and might be seeing their end. POS and DAG are untested solutions that might provide a future, but it will be years before people trust it.
>Stable coins are centralized, but provide the ability to transfer assets with limited costs. These will require centralization
>Fast/cheap/privacy coins are looking to beat bitcoin at moving money.
That said, just because a crypto is useful, doesnt mean that it will grow in value. The value may be using the coin rather than holding the coin.
[+] [-] CPLX|7 years ago|reply
What's it useful for?