[rufusroflpunch]

It’s not really any less of a dollar than any other dollar is. All of our digital dollars are just bank liabilities. Circle and Tether are just banks with dollar liabilities. Their liabilities can be transferred on crypto networks rather than traditional bank wires.

[rglullis]

> Circle and Tether are just banks with dollar liabilities.

But no regulatory oversight, and no chance for the common folk to prosecute or get their money back if they default.

I am one of the resident crypto apologists here on HN, but there is no way that we should even try to accept what the big exchanges are doing. The whole point of crypto is to have systems that do not depend on "too big to fail" institutions, why are we suddenly trying to find excuses for their BS?

[matthewdgreen]

Tether has no meaningful regulatory oversight. Circle has money transmitter licenses in most US states, some of which cover them as a virtual asset service provider, and require specific conditions around the way that they store customer funds: https://www.circle.com/en/legal/usdc-terms

I'm not claiming this is perfect, but it's pretty different.

[jacobsimon]

Not trying to make excuses for any of these companies. I'm just saying, in the abstract, there are lots of reasons why an end user would want a stablecoin besides "avoiding regulations". Even if it weren't pegged to a national currency, there is value in having a digital currency that limits its volatility. Pegging to another currency is a shortcut for doing that w/o needing decentralized monetary policy.

[rufusroflpunch]

Sorry, I did not mean to insinuate anything resembling cover for these stablecoins. I do not own any and I never would. In fact, I only own Bitcoin and I don’t keep any on any exchange at all. This is the only way I would ever recommend when interacting with cryptocurrencies.

[thatguy0900]

It is less of a dollar, because I can say you can exchange it for a dollar when you can not, in fact, exchange it for a dollar when you try to,because I never had enough(or any) dollars. In the real world when the bank runs out of dollars the government will give me dollars instead.

[aeternum]

For US citizens perhaps, but if you're a Russian citizen or company, the USD in your bank account is now just a worthless database entry.

Just because that weapon hasn't been pointed at some group of US citizens yet doesn't mean it can't in the future.

[jacquesm]

> In the real world when the bank runs out of dollars the government will give me dollars instead.

Up to a point.

[rufusroflpunch]

I think that is a fair critique, but that will be coming at some point, very likely. Either a law requiring 100% liquid reserves, or a law bringing them into the FDIC system.