Stable Coins are most stable cryptocurrencies
The most stable first generation cryptocurrency
The most famous example is Tether pegged to the dollar. The issuer of USDT is Tether Limited, which is committed to collateralizing USDT at a 1: 1 rate to the US dollar. Despite the fact that this cryptocurrency has been criticized more than once, has not undergone an external audit, it can still be called the most stable cryptocurrency. To be convinced of this, it is enough to look at the history of the USDT rate.
Disadvantages of stable cryptocurrencies
Based on the above information, the main disadvantages of stable coin can be deduced:
Stable unstable cryptocurrency
Another stable coin concept is pegging to conventional cryptocurrencies. The technique seems a little strange. The stability of such cryptocurrencies is ensured by the airbag in the form of an excess of digital assets. For example, to keep the stable coin rate at $ 2, you need to have $ 4 of unstable cryptocurrency in reserve. Then, if the rate of an unstable cryptocurrency falls by 50%, that is, to $ 2, stable coin will still fulfill its obligation to pay the required amount.
In order not to look for examples for a long time, you can take the bitUSD smartcoin, which is tied to its BTS cryptocurrency.
Who is involved in my transaction?
Both blockchain (the breakthrough technology underpinning Bitcoin) and DLT (levering blockchain technologies) continue to evolve. Stablecoin cryptocurrency is the subject of ongoing discussion as regulators, policymakers, governments and financial institutions around the world debate implementation. For less popular national currencies, this may be the innovation necessary to shift from physical to digital cash, and as such, stablecoin offers a viable solution. Fnality, the newly created consortium of banks using UBS’s stablecoin, is focused on such solutions and is making progress.
Summary
As you can see, it is quite simple to solve the problem of saving funds after the ICO if you carry out this procedure using a stable coin. It is enough to choose the most suitable concept.
The most famous example is Tether pegged to the dollar. The issuer of USDT is Tether Limited, which is committed to collateralizing USDT at a 1: 1 rate to the US dollar. Despite the fact that this cryptocurrency has been criticized more than once, has not undergone an external audit, it can still be called the most stable cryptocurrency. To be convinced of this, it is enough to look at the history of the USDT rate.
Disadvantages of stable cryptocurrencies
Based on the above information, the main disadvantages of stable coin can be deduced:
- The possibility of centralization. Yes, many conventional cryptocurrencies have such a risk, but almost all stablecoins must be controlled by a separate organization, which is not the case in the classical concept of cryptocurrencies.
- The risk that the controlling organization will go bankrupt or will not fulfill its obligations to the holders of the cryptocurrency.
- Some stable tokens refuse auditing.
- It is difficult to make money on the stable cryptocurrency rate.
Stable unstable cryptocurrency
Another stable coin concept is pegging to conventional cryptocurrencies. The technique seems a little strange. The stability of such cryptocurrencies is ensured by the airbag in the form of an excess of digital assets. For example, to keep the stable coin rate at $ 2, you need to have $ 4 of unstable cryptocurrency in reserve. Then, if the rate of an unstable cryptocurrency falls by 50%, that is, to $ 2, stable coin will still fulfill its obligation to pay the required amount.
In order not to look for examples for a long time, you can take the bitUSD smartcoin, which is tied to its BTS cryptocurrency.
Who is involved in my transaction?
Both blockchain (the breakthrough technology underpinning Bitcoin) and DLT (levering blockchain technologies) continue to evolve. Stablecoin cryptocurrency is the subject of ongoing discussion as regulators, policymakers, governments and financial institutions around the world debate implementation. For less popular national currencies, this may be the innovation necessary to shift from physical to digital cash, and as such, stablecoin offers a viable solution. Fnality, the newly created consortium of banks using UBS’s stablecoin, is focused on such solutions and is making progress.
Summary
As you can see, it is quite simple to solve the problem of saving funds after the ICO if you carry out this procedure using a stable coin. It is enough to choose the most suitable concept.
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