Dona Ferentes
Pengurus pengatur
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the lead villain, although likely loved by his mother, is an ugly brute; who would want to play that role?
the lead villain, although likely loved by his mother, is an ugly brute; who would want to play that role?Re FTX, I can't wait for the movie ?.
What's the purpose? thats a good question.It's an idea, but what is the purpose of this? You send in your 10 oz of physical gold and end up with a gold-crypro-token-key-number that says you have 10 oz of gold - which presumably you can use in to buy a cup of coffee with some app, then buy a 1-week cruise to Alaska, or pay your electricity bills. or maybe do nothing and sit on the cryptogold.
That didn’t actually answer my question.What is a gold-backed token and how does it work?
Gold-backed tokens are getting increasingly popular as a more accessible alternative to investing in physical gold.cointelegraph.com
The 13,235 different cryptos exist because people are speculating on them trying to get rich quick, but of course this doesn’t imply that any of them have any real long term value.What's the purpose? thats a good question.
More broadly - Why are there currently 13,235 different crypto tokens with a market cap of 869 Billion USD?
Why do some people collect physical silver? My neighbour has 8 cats - Why? Some people go on holiday to North Korea - why?
Elon paid 44 billion for Twitter - thats nuts - why do that?, why build rockets and plan to go to Mars - its irrational, its all irrational.
Probably one of the Baldwins.the lead villain, although likely loved by his mother, is an ugly brute; who would want to play that role?
The presumption must be that any frictional and storage costs would be assessed proportionally to the stable coin holder in some manner. I am unaware of the specifics of how this would be done. I will be more interested in such details once a gold-backed stable coin project gains momentum, recognition and broad acceptance as sound digital money and a real store of value.That didn’t actually answer my question.
Which was how would the frictional costs of the system described by so cynical be paid.
Also, I guess I can add to that how is the long term viability of these gold back coins you linked maintained, because surely if they are backed by gold that gold requires a certain fixed monthly cost to store.
It’s a genuine question I have, eg how does their business model cover the cost of providing the coins and storing the gold?
I think I would prefer one of the many other stores of value that also produce income, rather than being a net cost to me.I will be more interested in such details once a gold-backed stable coin project gains momentum, recognition and broad acceptance as sound digital money and a real store of value.
Gold ownership either requires self-custody (free, but not risk free) or a trusted custodian for a fee. Real digital gold requires a trusted custodial model. A store of value implies retention of purchasing power relative to debased fiat and low volatility. Returning to a gold standard today would likely necessitate a blockchain based solution.I think I would prefer one of the many other stores of value that also produce income, rather than being a net cost to me.
This is true of any asset not in self-custody. Even then, anything you own can be confiscated or rendered useless/valueless by governments whether in your direct possession or not.as soon as you tie this "store of value" to a lump of gold sitting in a location some where, we lose part of its insurance value in that it can be lost to governments, theft or corruption in times of war etc when we would need it the most.
Agree that CBDC will dominate. A gold backed CBDC, essentially returning to a gold standard, would be ideal but seems unlikely. If, as some have suggested, a "great financial reset" event occurs and ushers in a new gold standard, I would expect that to be implemented via blockchain.As I have said before digital currencies will work, but they will be fiat style ones backed by reserve banks and designed to be actual currencies, not these speculative things.
1. Yep I have an understanding of what a store of value is, As I said I prefer stores of value that also generate income, for example quality pieces of industrial real estate, on long 30 year leases.1. Gold ownership either requires self-custody (free, but not risk free) or a trusted custodian for a fee. Real digital gold requires a trusted custodial model. A store of value implies retention of purchasing power relative to debased fiat and low volatility. Returning to a gold standard today would likely necessitate a blockchain based solution.
2. This is true of any asset not in self-custody. Even then, anything you own can be confiscated or rendered useless/valueless by governments whether in your direct possession or not.
3. Agree that CBDC will dominate. A gold backed CBDC, essentially returning to a gold standard, would be ideal but seems unlikely. If, as some have suggested, a "great financial reset" event occurs and ushers in a new gold standard, I would expect that to be implemented via blockchain.
The 13,235 different cryptos exist because people are speculating on them trying to get rich quick, but of course this doesn’t imply that any of them have any real long term value.
Silver is a real commodity with a real use, so had some value even if you took the speculators away.
Pets and holidays have real world positives outcomes.
Twitter has a chance of being a real business producing real cashflow and paying dividends.
What do the crypto’s do for their holders outside of hoping a bigger idiot comes along to pay more?
Police in Estonia have arrested two men accused of a $US575 million ($870 million) cryptocurrency fraud, United States authorities confirm.
An indictment that was unsealed in the US District Court in Seattle contains charges against Estonian citizens Sergei Potapenko and Ivan Turogin, both aged 37, with wire fraud and conspiracy to commit money laundering.
Four other people living in Estonia, Belarus and Switzerland were also charged, but their identities have not been released.
Prosecutors said that, from 2015 to 2019, the suspects tricked hundreds of thousands of people into buying contracts for a cryptocurrency mining service called HashFlare and investing in a virtual currency bank called Polybius Bank.
In reality, the businesses operated as pyramid schemes, prosecutors said.
The men are accused of using shell companies to launder the fraud proceeds and to purchase real estate and luxury cars.
According to the US Justice Department, the men are in custody in Estonia pending extradition to the US.
Good evening basilio,...
My question would be how this collapse will impact on the mainstream financial systems ?
...
...and this:What’s the current global outlook for crypto?
There has been a surge of interest in cryptocurrency from consumers to businesses to regulators over the last several years. Much of this stems from increasing communications and clarity from regulators, which in turn gives businesses the comfort to launch their crypto products in their respective markets. In the US, both the Securities and Exchange Commission and the Commodity Futures Trading Commission have put out new guidance and enforcement actions. The Senate has held numerous hearings on crypto regulation. While there is no global licensing system for cryptocurrency, there is a continued pattern of positive or no regulation for most countries. Additionally, countries like El Salvador have even adopted bitcoin to be legal tender alongside the US Dollar.
How has the crypto market evolved in recent years?
There has been a surge in emerging use cases outside of the main “store of value” value proposition. Cryptocurrencies like Ethereum and stablecoins like USD Coin or USD Tether continue to see strong adoption. Ethereum has provided a springboard for Decentralized Finance (DeFi) applications that allow for consumers to become direct participants in activities previously limited to banks and other third parties (e.g. lending, payment processing, etc.) and partaking in the higher risk/reward that comes with that. Stablecoins, for instance, allow individuals and businesses to make direct payments and move funds across borders instantly 24/7 outside traditional bank hours and holidays without a third party.
What does this mean for financial institutions?
This presents both a risk and an opportunity for financial institutions (FIs). Consumers have indicated their desire for new and innovative solutions to generate returns in today’s macroeconomic environment. Inflation is high and consumers are increasingly looking to seek out products and services that can help generate outsized returns accordingly. If traditional FIs do not offer this, consumers are moving their funds to brokers and service providers that do. One top 20 bank has seen outflows of hundreds of millions of dollars to cryptocurrency exchanges last year alone.
That said, FIs are trusted providers and consumers have indicated many would prefer their FIs add these additional services like the ability to buy/sell bitcoin instead of figuring out how to manage all that on their own. By adding crypto capabilities to their offerings, FIs can satisfy customer demand, add fast growing innovative products while sharing in the fee revenue opportunity.
What are the key considerations for FIs in building their crypto strategy – and where are most on this journey?
FIs first need to decide where cryptocurrency is on the demand spectrum and what services their customers are interested in to determine the correct prioritization. This can be done actively by talking to customers, commissioning surveys and passively by analyzing bank outflows.
FIs then need to decide how much and what areas of the crypto business activity they want to perform themselves - partner vs. build and buy/sell/hold vs. DeFi lending/staking, etc. As cryptocurrency is still new for most FIs and not their main offering, many will prefer to partner with reputable and established cryptocurrency providers and lean on their regulatory, licensing, and reporting programs instead of building the same from scratch.
The FIs may want to engage with their respective regulators depending on how they are chartered and provide notice of their intended offering.
For most FIs, it is only a matter of when as it relates to crypto offerings. Consumers across all geographies and demographics want access to the rapidly growing cryptocurrency ecosystem. It is clear that cryptocurrency is not going away, so the decision is more if an FI prefers to be a leader or is content with being a follower in the space.
Where do we see the future of crypto?
Thirteen years since the invention of Bitcoin, it is clear that cryptocurrencies are here to stay. While there will always be cryptocurrency specific companies, most companies will incorporate crypto into their business in one way or another, often behind the scenes. From offering seamless ways to obtain exposure to the latest tokens through to cheaper, faster payments and managing global treasuries and foreign currency exchange, cryptocurrencies can offer a better way for individuals and businesses to transact leading to higher customer satisfaction and retention.
Stablecoins are one of the largest use cases for blockchain technology. Stablecoins are a class of cryptocurrencies that attempt to offer price stability by being backed by selected collateral or managed by an automated set of rules known as algorithm. There are four types of stablecoins:
1. Fiat stablecoins: collateralized by fiat currency(s) held in a bank account
2. Commodity stablecoins: collateralized by commodity(s), such as gold or oil
3. Cryptocurrency stablecoins: collateralized by one or more cryptocurrencies
4. Non-collateralized stablecoins: an algorithm based off supply and demand principles to maintain stable prices at all times
So, what are the origins of stablecoins? Back when the cryptocurrency industry first started, traders looking to purchase cryptocurrencies would use bank transfers to move fiat currencies between their bank accounts and cryptocurrency exchanges. This transfer process took several business days to complete, thus decreasing opportunities to trade in the markets. This friction led to the creation of Stablecoins. The first stablecoin was created in July 2014 by Bitshares called BitUSD with the goal of providing an easy and fast on/off ramp within cryptocurrency exchanges for trading. BitUSD was later collateralized by cryptocurrencies, thus causing the price to fluctuate which led to losing its parity to $USD in 2018. There have been several stablecoins created since BitUSD, with the largest stablecoins by market cap (as of October 2022) being Tether, USD Coin, Binance USD, and DAI. The increase in number of stablecoin projects has led to dramatic growth in total stablecoin market capitalization from $5.6 billion in January 2020 to $181.76 billion in April 2022. However, this drastic growth has come with a few major setbacks for the market.
The downfall of Terra
Let's take a look at Terra. Terra is a protocol that uses a swap algorithm to peg stablecoins to three fiat currencies. Before the downfall in May 2022, Terra used the cryptocurrency Luna as collateral for each of the Terra stablecoins. Luna’s market capitalization dropped from $18.6 billion on May 9th 2022 to less than $1 billion by May 19th 2022. This drop was caused by an individual selling $285 million worth of Terra’s stablecoins called Terra USD (also known as UST), which led to triggering UST to lose its US Dollar parity. UST then continued decreasing in value, causing Terra to sell the protocol’s bitcoin holdings to preserve Luna’s price. The overall cryptocurrency market ramifications of this event are drastic with several large holders of UST losing their money, billions of dollars’ worth of bitcoin being sold off on the open market (which was then amplified by other macroeconomic market conditions), and over leveraged cryptocurrency positions.
The Terra example not only fuels fear in the market but its also become a poster child for individuals to create misinformed statements that stablecoins are risky. However, much of this misconception stems from the shock of the volume of loss, and only pertains to one of 200+ stablecoins. Several of these other stablecoin issuers, such as USDC, are pegged 1:1 with the US Dollar and undergo treasury audits from external accounting firms. Not only are audited fiat stablecoins less risky than other stablecoins, they also have several global benefits:
1. Fiat stablecoins allow individuals around the world to have access to several currencies such as the Euro and Dollar. This is crucial for the millions of people under high inflation and/or currency collapse pressures.
2. Fiat stablecoins allow two parties to send cross-border transactions for a fraction of current costs using the traditional correspondent banking system. The remittance process is explained on this blog post.
3. Stablecoins offer the opportunity for users to receive higher APY in a stablecoin yield account than a traditional savings account. The United States national APY average for a savings account is 0.16% (October 2022). Stablecoin yield varies per exchange ranging from 0.15% APY to 7% APY for USDC.
Global Regulation
Regulators around the world are actively creating governing frameworks to account for stablecoins. Senator Cynthia Lummis, also known as ‘Crypto Queen’, from Wyoming has led the regulatory conversations for cryptocurrencies in the United States. Senators Lummis, Toomey, Portman, Warner and Sinema proposed an amendment to the Infrastructure Bill in August 2021 to encompass digital asset regulatory clarity.
Legislation efforts are also underway in the European Union. The EU agreed on the Markets in Crypto-Assets (MiCA) regulation at the end of June. Although the final text is still to be published, MiCA may require stablecoin issuers to build up capital and liquidity reserves and should establish a cap of 200 million euros in transactions per day. The push for increased stablecoin oversight by governments has received mixed opinions, but at the heart of the debate, regulatory clarity will provide guiderails for innovation within the industry.
Where do we go from here?
The future of fiat stablecoins is very promising due to their uses cases of no-barrier access to global currencies, high yield savings accounts, and remittance technology with low fees. These world-changing use cases along with increased global regulatory clarity will drive continued innovation in the stablecoin market. We predict the stablecoin market will continue growing in the coming years and look forward to integrating the technology.
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