Stablecoins
stablecoins
fiat FX basket with the links to crypto-world
A couple of projects ACChain and Globcoin
For the technical aspects, see also Saga paper
see diagrams in particular
To interface with traditional institutions, Saga requires a degree of centralised
implementation. We ensure transactions are both transparent and immutable. Our
discovery tools allow participants to monitor system transactions, allowing participants to
assess the integrity of governance.
thoughts (MT)
Ideally, a stablecoin can be a good anchor for cryptoasset class. But the future depends on the fiat-crypto connection, which is highly dependent on the regulations.
MT - I am personally sceptical that the idea of stablecoin is consistent My opinion is close the opinion of Albert Wenger The Quest for a Stable Coin, i.e. more questions than answers.
february 2018 - a good review of ALL main stablecoins is the last section of the Basecoin whitepaper
Important attempt to answer Could a crisis of confidence cause a death spiral in the system?.
Not convincing to me and to Basecoin (aka the Basis Protocol): the worst idea in cryptocurrency, reborn
From one side, a stablecoin needs to be connected with real world (and maybe fiat or real assets). From another side, growing projects cannot have artificial stability. "Anti-fragility" (of Taleb) means some volatility, and perhaps, the idea
Another appropriate sceptical view series Stablecoins are doomed to fail, Pt. III: SAGA
science fiction not based on reality ??? A Plethora of Stablecoins: Price-Stable Protocol Utility Tokens
Vitalik and Preston Byrne
Stablecoins are "synthetic assets", which are very familiar in the financial industry. Examples include ETF, CDO, etc. But is it very natural asset? The discussion between a supporter, Vitalik, and a critic, Preston, raise important points of tail risk, capital inefficiency, and the trading bots supporting the price.
Vitalik - A distinction without a difference. DAI is about getting exposure to the dollar without holding it.
@prestonjbyrne - That's my point. DAI isn't an exposure to USD. As of today, it is an exposure to Ether.
how to create positive convexity projects?
Short Convexity - The big problem awaiting token teams
how to hedge ICOs... and whole projects?
DeHedge - Risk-hedging platform for cryptocurrency investors
I(MT) have been talking to some people on the project. The idea is very similar to CVA (Credit Valuation Adjustment) hedging.
mechanisms of stabilization
Volatility Insurance and the MakerDAO platform by Yotam Gafni The Stable Coin — A Cryptocurrencies Philosopher’s Stone
Stablecoins: designing a price-stable cryptocurrency
The classification of stabilization is being a) crypto collateral b) fiat collateral c) central bank actions and seniorage shares. Currency should be a stabilising mechanism for the larger economy, and the economics shows that stable FX-free capital flow - sovereign monetary policy is Impossible Tirnity.