Could stable coins save a deprecating economy

[Sophokles]

How would stablecoins save a depreciating economy? Aren't them tied directly to the value of national (Fiat) currencies? I appreciate the UK's efforts in embracing the revolution with open arms. But simply adopting stablecoins is not enough to save their economy. Putting inflation under control is what will eventually solve the problem. The thing is, our world is going from one crisis to another. With the COVID-19 pandemic still at large, rising geopolitical tensions, and wars, we can never expect the mainstream economy to recover.

All stablecoins are pegged to USD and if done correctly then it can boost the economy. In countries like Lebanon and others where there is too much fluctuation in local currency, using stablecoin would help them. In countries where the local currency is stable using stable coins would only destroy their economy. Then there is a big question as to why use a stablecoin as it will indirectly give economic control to the USD or the US government. What the UK government is doing just replicating their pound to a stablecoin and creating their form of CBDC I think.

All stablecoins are not pegged to USD. We have stablecoins pegged to EUR, INR etc but USD is the most common in the space and widely acceptable. Using stablecoin is much easier for people outside of the USA and Europe. If you live outside of Europe you can still keep your money in EURO currencies by using the EURO pegged stablecoin. This becomes convenient for many people but there is some risk associated with it. Most of this stablecoin is related to lending platform and these platforms are one of the primary targets of hackers and exploiters. So if these lending platforms got affected their stablecoin would as well.

[Bushdark]

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How would stablecoins save a depreciating economy? Aren't them tied directly to the value of national (Fiat) currencies? I appreciate the UK's efforts in embracing the revolution with open arms. But simply adopting stablecoins is not enough to save their economy. Putting inflation under control is what will eventually solve the problem. The thing is, our world is going from one crisis to another. With the COVID-19 pandemic still at large, rising geopolitical tensions, and wars, we can never expect the mainstream economy to recover.

All stablecoins are pegged to USD and if done correctly then it can boost the economy. In countries like Lebanon and others where there is too much fluctuation in local currency, using stablecoin would help them. In countries where the local currency is stable using stable coins would only destroy their economy. Then there is a big question as to why use a stablecoin as it will indirectly give economic control to the USD or the US government. What the UK government is doing just replicating their pound to a stablecoin and creating their form of CBDC I think.

All stablecoins are not pegged to USD. We have stablecoins pegged to EUR, INR etc but USD is the most common in the space and widely acceptable. Using stablecoin is much easier for people outside of the USA and Europe. If you live outside of Europe you can still keep your money in EURO currencies by using the EURO pegged stablecoin. This becomes convenient for many people but there is some risk associated with it. Most of this stablecoin is related to lending platform and these platforms are one of the primary targets of hackers and exploiters. So if these lending platforms got affected their stablecoin would as well. 

Stable coins are mostly owned by private individuals or group of people like team. I don't think the government have the time to create a stable coin when they can easily develop there local fiat and create a digital version just like the way we have Chinese Yuan. This kind of coin enables citizens and other people that are ready to trade with such a coin. The government can only regulate stable coins but don't have a full right to own there own stable coin. Stable are mostly use by people to create a differences between volatile coins and escape bear market.

[Sophokles]

ftp://

How would stablecoins save a depreciating economy? Aren't them tied directly to the value of national (Fiat) currencies? I appreciate the UK's efforts in embracing the revolution with open arms. But simply adopting stablecoins is not enough to save their economy. Putting inflation under control is what will eventually solve the problem. The thing is, our world is going from one crisis to another. With the COVID-19 pandemic still at large, rising geopolitical tensions, and wars, we can never expect the mainstream economy to recover.

All stablecoins are pegged to USD and if done correctly then it can boost the economy. In countries like Lebanon and others where there is too much fluctuation in local currency, using stablecoin would help them. In countries where the local currency is stable using stable coins would only destroy their economy. Then there is a big question as to why use a stablecoin as it will indirectly give economic control to the USD or the US government. What the UK government is doing just replicating their pound to a stablecoin and creating their form of CBDC I think.

All stablecoins are not pegged to USD. We have stablecoins pegged to EUR, INR etc but USD is the most common in the space and widely acceptable. Using stablecoin is much easier for people outside of the USA and Europe. If you live outside of Europe you can still keep your money in EURO currencies by using the EURO pegged stablecoin. This becomes convenient for many people but there is some risk associated with it. Most of this stablecoin is related to lending platform and these platforms are one of the primary targets of hackers and exploiters. So if these lending platforms got affected their stablecoin would as well. 

Stable coins are mostly owned by private individuals or group of people like team. I don't think the government have the time to create a stable coin when they can easily develop there local fiat and create a digital version just like the way we have Chinese Yuan. This kind of coin enables citizens and other people that are ready to trade with such a coin. The government can only regulate stable coins but don't have a full right to own there own stable coin. Stable are mostly use by people to create a differences between volatile coins and escape bear market.

I don't think in countries like Lebanon the government is promoting crypto based stablecoins. It is their citizens who are using it due to the hyperinflation these countries economies are going through. They need to use an alternative of their fiat currencies to get away from the inflation and crypto based major stable coins like USDT and USDC are some of the most convenient for them to use. They can easily use them like they use a credit card and it is not hard to integrate them with their local businesses. The government can not directly use them as there will be regulatory issues.

[Biznesmen]

Introducing stablecoins as a major currency in countries experiencing economic instability is an interesting idea that has both potential benefits and challenges. I don't really know if this would be a good idea but I think this could help many countries that are facing a real currency depreciation.
This are some of the benefits I think I could bring

Stability: Stablecoins are designed to be less volatile than traditional cryptocurrencies like Bitcoin or Ethereum. This stability could provide a more reliable medium of exchange and store of value, especially in economies with rapidly depreciating currencies.

Inflation Control: Stablecoins are typically pegged to a stable asset like a fiat currency or commodity, which could help countries better control inflation and manage their monetary policy especially in African countries.

Financial Inclusion: Stablecoins could increase financial inclusion by providing access to digital financial services for individuals who are unbanked or underbanked.

Reduced Transaction Costs: Digital transactions using stablecoins can potentially be more efficient and cost-effective compared to traditional payment systems, especially for cross-border transactions.

Please share your insights on this topic.

Economic depreciation has nothing to do with currency at all, because economic depreciation means the wear and tear of an asset beyond its expected capacity or utility. So it's related to the assets of an economy, not the currency. And the causes of the depreciation are wear and tear on an asset, perishability, economic advancement, expiration of dates, etc.Even if you meant depreciation of currency, stable coins are not changing their value; they carry the same value as the fiat currency. Then how can you expect stable coins to save you from the depreciation of currency?So the depreciation of currency and the economy is a natural economic phenomenon, but when it crosses the line, the government and other parties are taking care of it.

[Abiky]

All stablecoins are not pegged to USD. We have stablecoins pegged to EUR, INR etc but USD is the most common in the space and widely acceptable. Using stablecoin is much easier for people outside of the USA and Europe. If you live outside of Europe you can still keep your money in EURO currencies by using the EURO pegged stablecoin. This becomes convenient for many people but there is some risk associated with it. Most of this stablecoin is related to lending platform and these platforms are one of the primary targets of hackers and exploiters. So if these lending platforms got affected their stablecoin would as well.

USD is the world's reserve currency, so it's normal to see USD-pegged stablecoins being the driven forces of the crypto market. Stablecoins linked to other Fiat currencies are not as popular as the USD ones. In countries where it's hard to get access to the USD directly, stablecoins makes wonders. You can virtually send/receive USD anywhere in the world without a bank account. How cool is that? This versatility allows countries to save a "depreciating economy".

Of course, that is subject to the USD's inflation rates. If inflation soars like crazy, the USD will lose value big time. What sense would it make to use a USD-pegged stablecoin by then? I'm glad there are plenty of options for everyone. Maybe these stablecoins will become the new CBDCs in the future?

[Blitzboy]

"

All stablecoins are not pegged to USD. We have stablecoins pegged to EUR, INR etc but USD is the most common in the space and widely acceptable. Using stablecoin is much easier for people outside of the USA and Europe. If you live outside of Europe you can still keep your money in EURO currencies by using the EURO pegged stablecoin. This becomes convenient for many people but there is some risk associated with it. Most of this stablecoin is related to lending platform and these platforms are one of the primary targets of hackers and exploiters. So if these lending platforms got affected their stablecoin would as well.

USD is the world's reserve currency, so it's normal to see USD-pegged stablecoins being the driven forces of the crypto market. Stablecoins linked to other Fiat currencies are not as popular as the USD ones. In countries where it's hard to get access to the USD directly, stablecoins makes wonders. You can virtually send/receive USD anywhere in the world without a bank account. How cool is that? This versatility allows countries to save a ""depreciating economy"".

Of course, that is subject to the USD's inflation rates. If inflation soars like crazy, the USD will lose value big time. What sense would it make to use a USD-pegged stablecoin by then? I'm glad there are plenty of options for everyone. Maybe these stablecoins will become the new CBDCs in the future?

The ease of sending 'digital cash' abroad without a bank is revolutionary. Isnt it like having a worldwide money at hand? That happens when inflation wobbles the USD? Suddenly, these stablecoins become unstable .

Imagine stablecoins pegged to a basket of currencies or commodities, reducing reliance on any single currency's stability. AI-driven stablecoins could modify pegs based on real-time economic variables. Think this may make the digital economy more resilient?

Your idea about stablecoins becoming CBDCs is intriguing. Is this the future of money? We're on the verge of a financial revolution as decentralised digital currencies change how we think about and use money. Huge potential, but also huge obstacles. Its a balancing act between innovation, regulation, and the ever-elusive trust of the public
"

[PlusOne88]

No, I think that is not a very simple idea to just say stable coins will save a depreciating economy because a lot of factors are in play. When there is an economic depreciation, it doesn't have to mean that it is all just have to be about coins. Even war, natural disasters, pandemic and many other things can also lead to the instability of an economy which will then affect most probably the value of an asset a country may have. Perhaps in the smallest sense it may, but not totally or generally.

[Abiky]

The ease of sending 'digital cash' abroad without a bank is revolutionary. Isnt it like having a worldwide money at hand? That happens when inflation wobbles the USD? Suddenly, these stablecoins become unstable .

Imagine stablecoins pegged to a basket of currencies or commodities, reducing reliance on any single currency's stability. AI-driven stablecoins could modify pegs based on real-time economic variables. Think this may make the digital economy more resilient?

Your idea about stablecoins becoming CBDCs is intriguing. Is this the future of money? We're on the verge of a financial revolution as decentralised digital currencies change how we think about and use money. Huge potential, but also huge obstacles. Its a balancing act between innovation, regulation, and the ever-elusive trust of the public
"

I believe governments will side with private companies to adopt stablecoins as their own. Why re-invent the wheel by launching a new digital currency from scratch? Using an already-established digital currency pegged to the value of Fiat, is the best solution. If governments take this approach, they will force private companies (Tether, Circle, Paxos, etc) to work for them. They will take over the world by storm whenever you like it or not.

Truly-decentralized cryptocurrencies (particularly Bitcoin) will survive, but they won't be used as massively as their centralized counterparts. The global economy will "reset", but with government-backed digital currencies as its "backbone". Who knows how far we are before this becomes a reality?