Conversation

Fiat-backed stablecoins look like pegged currencies. Sri Lanka pegged its currency to the USD. Sri Lanka is now in a world of hurt, in part because the peg broke. What happens if (when?) fiat-backed stablecoins' peg breaks?

SBF

@SBF_FTX

Replying to

@friedmandave

pegged currencies lose their peg when they're fiat *pegged* but not fiat *backed* 1:1 same with stablecoins

12:23 PM · Jul 23, 2022Twitter Web App

Retweets

Quote Tweet

Likes

Dave Friedman (not parody)

Replying to

Good point.

Replying to

and

Yes, visual inflation.

Replying to

and

Are u long ?

Replying to

and

- can we facilitate a virtual town hall or Twitter Space for this discussion? We need educational content on this topic, especially moving pegs (such as float NAV) vs. fixed 1:1 USD.

Dave Friedman (not parody)

Replying to

and

I’m game for it.

Show replies

Replying to

and

Sam gets pegged by Tabasco

‹⟨ Friar ‹⟨†⟩› Tuck ⟩›

Replying to

and

Simone you pay$600 to fill your had tank in your work truck instead of$60 . your an adult you deal with it you overcome. Turn on, Tune in, Prop(aganda) OUT!

Viswanath Vellaiappan

Replying to

and

Much like LUNA *pegged*USD 🆚 USDC *backed* USD case?

Replying to

and

Amen. When an exchange does not have liquidity for a fiat-backed stablecoin transaction and a redemption is triggered and successful that is NOT the stablecoin being de-pegged. That is the perfect example of how a fiat-backed stablecoin provides market stability.

Dave Friedman (not parody)

Replying to

and

Yup, it’s an important distinction!