One one hand, criticisms of seignorage stablecoins are helping cast light on the structural shortcomings of fiat. On the other, a @nntaleb would say that “what works cannot be irrational.”
Do you think transferring large sums of money into and out of 2nd and 3rd world countries is easy?
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Should have clarified, cross-cryptocurrency exchanges.
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Either Bitcoin’s big success or a functional Stablecoin’s big success could literally help people in hyperinflationary nations and even cause the collapse of oppressive / monetarily incompetent regimes... much bigger implications than just trader arbitrage.
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Yes, I agree with the value-proposition stablecoins have; that's not what I'm arguing against. Instead, I'm saying that their argument is unsound because their premises don't hold.
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Also above you said “There might never be a real need for them in the first place” :) Which is provably wrong. My aunt in rural post-USSR with low shit fiat salary & no access to dollar or sophisticated low-risk financial instruments, would love access to a stable store of value.
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That point is contingent on the premise that current solutions will minimize the hypothetical competitive advantages of stablecoins. Your aunt would get access to stable SoV from current solutions.
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Here is my problem with this. If you look at existing, fixed-supply coins as a “product”, then it’s only a good SoV after it’s already huge (3T+?) ... u feel me? Stablecoins (assuming they work) can offer stability even at 50million mcap. The promise is crazy.
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Are you distinguishing here between seignorage and collateralized coins or generally referring to both?
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Whichever works. Non-collateralized is more badass. All money is social consensus.
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