2/ Obviously some users can hedge via futures, but if you're stashing money b/c you live in a current/potential kleptocracy (the Holocaust scenario) the CBOE is not an option.
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1/ Watching #btc volatility & thinking about current use cases, I finally appreciate why @VitalikButerin says it's important to make a StableCoin. Ppl should be able to store value w/o taking on all this currency risk.
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3/ As speculators we expect everyone to just join the hodl club, but that exemplifies the immaturity of the tech/us. Most users don't want to be speculators, so if using and speculating are commingled, that's bad for actual use & ultimately for our investment.
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4/ A club that won't let anyone in who doesn't want to gamble is going to end up being a club of gamblers, not the world new financial system. A good StableCoin is one possible answer.
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5/ Making one, however, without centralization or counterparty risk, is...non-trivial. But deeply fascinating if you're into monetarism & cryptoeconomics! Looking forward to continued community speculation on the topic.
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6/ p.s. since many seem unversed in the basics of how & why to make a "StableCoin", some reading: https://blog.ethereum.org/2014/11/11/search-stable-cryptocurrency/ … https://medium.com/topl-blog/dangerous-volatility-and-why-we-need-a-stable-cryptocurrency-6d66dcd605f8 … https://bitshares.org/technology/price-stable-cryptocurrencies/ …https://thecontrol.co/stablecoins-a-holy-grail-in-digital-currency-b64f3371e111 …
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Cryptocurrencies are emerging technologies. They are by no means ready to offer stability at this stage. Maybe in the future some might be able to stabilize small fluctuations in buy/sell pressure but nothing like what we have today.
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Right, I'm not suggesting that all tokens (established or new) become stable; just that (as Vitalik has suggested) someone implement a StableCoin: a token specifically designed for stable value. Which is hard - that's why it's interesting.
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The "brave" are willing to fund the development and use of crypto precisely because of the potential gains. The lame (or more cautious) don't understand or buy into crypto and (at least now) wouldn't buy a stable coin. The brave don't care about or want stability.
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The "brave" claim they are funding something that will transform the global economic system. A system which mainly consists of the "lame". Therefore, the "brave' are liars unless they can create something the "lame" want to use.
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It will come. It's inevitable. It's like stock and bond markets. But crypto is not ready for stable because those who would buy stable aren't ready for crypto.
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Sure, that's a fair point. But it is important that crypto transitions to real use cases, and many such cases benefit from stability. I don't think it's too soon for research & prototyping (and some is being done).
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Totally agree!
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Check out
@Goldmint_io. They're building technology to store and transfer gold on blockchain. Their$GOLD token will be backed 100% by gold. -
Yes, it's easy to create a pegged currency with 100% reserve...but that requires trusting the issuer. The question is how to create a decentralized stable currency without that counterparty risk.
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2.) They're plan is to have these Custody Bots all over the world. Once the gold is withdrawn from the machine, an equal amount of tokens is removed from the blockchain.
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That's cool, but it's not a trustless digital asset. How do you keep the bots from being stolen? Put them in banks? But then how is it different from the bank just issuing gold-backed tokens? Also, I feel like the assaying system would be vulnerable to fraud.
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2.) The assaying system is internal to the vault-like machine, so I'm not sure how it would be vulnerable.
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The assaying system measures physical properties, using tools like a mass spectrometer, to determine the amount of gold. It seems quite likely that there will be a way to spoof it (and immediately withdraw real gold elsewhere).
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It also will using a hydrostatic weighing system. I know that gold-plated tungsten can be used to fool rudimentary hydrostatic weighing, but I'm not aware of any metal that could pass HS and MS checks. I'll have to look more into it.
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Thank you. That answers my age old question how a coin which is supposed to be every day payment option can also be a HODL? I asked the same question to
@SatoshiLite few days back, didn't get an answer. -
Right, value fluctuations don't matter for payment, you just convert into it at time of purchase at market rate. But for store of value, most customers want stability, this is money they're saving, not betting at roulette.
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Well, the payee can insta-convert out too, presumably.
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That's true, you'd need pretty fast transactions. And at that point, why even have a transfer token with floating value? I'm getting kinda skeptical of the utility of floating-valued transfer tokens....
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