Your NOT a greedy piece of shit? Then Bitcoin is not for you. The Crypto industry as a whole doesn’t need you ethically nonsense. Good day Sir, I said Good Day.
There is a missing dimension. If every coin is backed by exactly a dollar, there is no need for treasury backing. Those dollars aren’t loaned out as risk capital, and they are not paying interest to the coin holders, so they should not have spread or liquidity exposure.
The issue is that Trump and many dems want to use the dollar to back speculative coins like Bitcoin. This will destroy our currency, as the value of all bitcoin is astronomical. If there were a run and we tried to defend it, it could easily devastate the dollar.
But what does it me to have "Every coin backed by exactly a dollar"? In practice, it lends most of it to the US government by buying treasuries. So it is loaned out and it does earn interest. They make a huge profit on it!
They use Cantor Fitzgerald, Schwab, and Fidelity to buy and hold the treasuries, so there's a risk that any of them goes bust.
None of this is exceptionally high risk stuff, but it does create a lot of risk when people are treating it as if there is a pile of physical dollars set aside to match the Stablecoins.
Your NOT a greedy piece of shit? Then Bitcoin is not for you. The Crypto industry as a whole doesn’t need you ethically nonsense. Good day Sir, I said Good Day.
There is a missing dimension. If every coin is backed by exactly a dollar, there is no need for treasury backing. Those dollars aren’t loaned out as risk capital, and they are not paying interest to the coin holders, so they should not have spread or liquidity exposure.
The issue is that Trump and many dems want to use the dollar to back speculative coins like Bitcoin. This will destroy our currency, as the value of all bitcoin is astronomical. If there were a run and we tried to defend it, it could easily devastate the dollar.
But what does it me to have "Every coin backed by exactly a dollar"? In practice, it lends most of it to the US government by buying treasuries. So it is loaned out and it does earn interest. They make a huge profit on it!
They use Cantor Fitzgerald, Schwab, and Fidelity to buy and hold the treasuries, so there's a risk that any of them goes bust.
They also invest other money (i.e. their profit), so this creates risk too. Also one of the other Stablecoins kept their dollars in Silicon Valley Bank, so they were affected when it collapsed. (https://www.sciencedirect.com/science/article/pii/S1057521923005173).
None of this is exceptionally high risk stuff, but it does create a lot of risk when people are treating it as if there is a pile of physical dollars set aside to match the Stablecoins.
That is true. And just more proof that currency should not be a store of value but a tool for exchanging value