There are currently over 57 "stable"coin projects in existence. Some are already live and others are still in development.
The vast majority of them will still have to build a marketplace or request integration into an existing marketplace if they are to ever really tap into being adopted as a 'currency'.
There is only 1 that has a trustless marketplace ready and an easy button web/mobile marketplace ready in a couple more months = BitBay
And the point I'm getting at is that now that all these stablecoins are beginning to come online, they better continue developing in a frenzy to build real world use applications as well.
Because if their hopes are to just sit back and remain 'sustainable' on centralized fundamentals by being used as a hedging mechanism for exchange traders, then they will most likely fail.
The shear number of new coins coming online will cause the industry's trade volume to get diluted more and more.
Investors need to take in consideration:
1) Definition - What is a stablecoin? Is it something that holds a hard pegged value to fiat or gold? What makes this fiat or gold stable? Is it not simply because its exchange price fluctuations are less volatile than other industries? So in the end, doesn't it just boil down to stabilizing the volatility? So why sell yourself short and let something else do that for you? Why not just create your own self sufficient volatility stabilizer? Why rely on something else to do it for you? Dependency is a weakness. And why stop there? If you remove the volatility, why does that mean you HAVE to keep it at a hard pegged 'value'? Why not let it find it's fair market value yet simply regulating the volatility while it searches for a fair market value! BitBay is the only stablecoin that simply enforces regulating volatility. BitBay doesn't need gold or fiat to do that for it! It's completely independent!
2) Fundamentals - how decentralized is it? Why does that matter? There are multiple reasons, but one big one I foresee is what happens to these centralized coins when governments simply create their own digital crypto fiat? Such a fear doesn't apply to decentralized coins.
https://bitcointalk.org/index.php?topic=1691458.140There are numerous coins that claim they are decentralized. Yet literally none of them can guarantee that they can 'truly' enforce their price because it always boils down to trusting that someone (custodians, backers, burners, traders, insurers, etc) will be there to enforce the correction. This is a major centralized flaw! And the more the stablecoin sector of the industry dilutes itself with new coins, the harder it is to sustain this design.
BitBay doesn't try to hard peg its value, so it doesn't "break" if it can't maintain a value. It can always enforce it's stability protocols because of this. This very protocol is what removes the volatility in the first place. Collateral is not needed. Collateral is always welcome. But it's voluntary only. If you want to put up a 4 million dollar buy wall on BitBay, you are a voluntary backer. If you pull your backing, the coin will adjust as needed with or without someone else coming to take your place with a new buy wall!
3) Investment potential - If you are a retail investor what reason do you have for investing in these coins? Does your centralized stablecoin reward retail investor coin holders? Or does it just make the elite market makers, exchange hosts more
money? What point is there in holding a stablecoin if it has no reward mechanism in place to provide you with a ROI.
https://www.forbes.com/sites/simonmoore/2018/09/10/why-you-should-avoid-stablecoins-as-investments/#67bd2fe17a07 There are a few coins that realize this and realize the potential in giving retail investors ROI for supporting the coins - not just the elite centralize backers, market makers, exchanges, developers, etc. And of these few coins, again, BitBay isn't focused on a hard pegged value. BitBay is always seeking fair market value, which means it can gain in value and potentially hold gains! When you combine our staking protocol to the system it makes for some interesting compounding gains on top of market price. In BitBay, people can buy up liquid coins and voluntarily freeze them for a higher stake reward interest rate. The current levels are set at: voluntary freeze (3 month time lock) = 4-5% newly minted coins per year, network frozen coins = 2-2.5% newly minted coins per year, and liquid coins = 1% newly minted coins per year. So imagine you had 10 million dollars invested in BitBay at the beginning of the year. You voluntarily freeze your coin supply 4 times back to back (3 month time locks) = you gain 4-5% newly minted coins. And on top of that, BitBay's exchange price increases by 10-12% over the course of 12 months. You do the math! That's a "little" bit better return than you'll get from any of these hard pegged stable coins!
Cheers!
