Are stablecoins a definite solution against a bear market?

[imutlinda]

Sorry to ask cause I only have a little knoweldge about stable coins. Do they increase/decrease they value just like any other coins or not since they are pegged to a certain currency? If they are not decrease their value, there are any chances it would make cryptocurrency stable not definitely a solutions for a declining market.

In short, Stablecoin is one of the stable coins that I usually use when the market is down because I don't like to take too much risk. therefore sometimes stablecoin can be used when we are afraid of declining market conditions.

[Adriano2010]

It can be if they are really a stable coins who is backed up by fiat money at the rate 1:1, if there are complain against it then is hard to trust it and hold a lot of money on because if something happen and will not value 1 usd then is hard to put money there.

[Script3d]

It can be if they are really a stable coins who is backed up by fiat money at the rate 1:1, if there are complain against it then is hard to trust it and hold a lot of money on because if something happen and will not value 1 usd then is hard to put money there.

I agree it can be a solution but only if its truly backed at 1:1 rate, some devs might commit fraud, i'll only trust stable coins if the backed asset is confirmed by a trusted bank, there are times tether go below one dollar but it doesn't go above a cent i don't think that's a problem if you trust stable coins, i'd rather have my money in fiat.

[ven7net]

In a dreaded bear market that's lasts a long time, do you think that stablecoins are the definite solution for preserving one's investments?

So far, there has been a few stablecoins like Tether and NuBits which have gone lower than $1 at rare occasions. For investors depending on stablecoins as safe-haven assets against a bear market, this brings some disappointment. Still, stablecoins are able to retain their value against the USD most of the times. If they remain as is, then one could simply pour money into stablecoins to protect yourself against a long-lasting bear market. If prices for cryptocurrencies on the market go even lower than usual, you can even sell your stablecoins back into crypto to get more coins for your money. But this might turn to be extremely risky in a volatile crypto market.

What are your thoughts?

When we talk about the bear market, then of course, many investors may simply not be able to withstand and sell their cryptocurrencies, moreover, all this is a hello to loss. The option of saving funds using stable coins may well help in this. Of course, a small fluctuation in the prices of stable coins is not as scary as a drop in the prices of cryptocurrencies in general. I also studied stable coins and they showed good stable value in the market.

[Linkkoin]

Are stablecoins a solution against a bear market?

It depends on what you may expect from cryptocurrencies. If you consider cryptocurrencies as a form of investment - then in accordance with the rule "buy low, sell high" it may not be the case at all.

Still, buying stablecoins could mean that on many of exchanges you could buy other coins faster than by sending a wire transfer and waiting yet another couple of days for an update of your account balance (when the price may not be that attractive).

If on the other hand, the volatility of cryptocurrencies is an obstacle for you for sending funds (and you are not a fan of xrp), then stablecoins could be interesting (especially if you want to sign a long term contract with companies located abroad). The only fear here, as shared by many cryptoenthusiasts, is that stablecoins are on this moment purely fake and not backed by fiat money 1:1 as promised.

As well, depending on WHERE we observe a bear market - stablecoins might not be very attractive if the bear market applies to the economy of the country, to which fiat currency a stablecoin is pegged.

[the rise]

It can be if they are really a stable coins who is backed up by fiat money at the rate 1:1, if there are complain against it then is hard to trust it and hold a lot of money on because if something happen and will not value 1 usd then is hard to put money there.

I agree it can be a solution but only if its truly backed at 1:1 rate, some devs might commit fraud, i'll only trust stable coins if the backed asset is confirmed by a trusted bank, there are times tether go below one dollar but it doesn't go above a cent i don't think that's a problem if you trust stable coins, i'd rather have my money in fiat.

maybe you only do an assessment on Tether, I suggest you can start using USDC because they use the officially audited circle foundation to connect to the bank, I'm sure this coin is really to your liking. It doesn't matter if you prefer fiat, but the topic is whether stable coins become a trading solution during the bear market, and of course I would say yes, if there is a slight change, prices will always adjust to 1:1.

[Vishnu.Reang]

Users need to understand that stablecoins were not designed to remove the problem of volatility. On the other hand, the very first stablecoins were invented in order to get around the restriction of using fiat currency in crypto exchanges (especially in China). Therefore, stablecoins doesn't represent the solution of keeping your wealth secure in a bear market. You need to think about the other options and strategies.

[electronicash]

It can be if they are really a stable coins who is backed up by fiat money at the rate 1:1, if there are complain against it then is hard to trust it and hold a lot of money on because if something happen and will not value 1 usd then is hard to put money there.

I agree it can be a solution but only if its truly backed at 1:1 rate, some devs might commit fraud, i'll only trust stable coins if the backed asset is confirmed by a trusted bank, there are times tether go below one dollar but it doesn't go above a cent i don't think that's a problem if you trust stable coins, i'd rather have my money in fiat.

maybe you only do an assessment on Tether, I suggest you can start using USDC because they use the officially audited circle foundation to connect to the bank, I'm sure this coin is really to your liking. It doesn't matter if you prefer fiat, but the topic is whether stable coins become a trading solution during the bear market, and of course I would say yes, if there is a slight change, prices will always adjust to 1:1.

tether sometimes will value to $0.99 and there are times that it also goes $1.01, a cent is not that much but if you have about a million USD like the whales in crypto, they might just complain why its price still fluctuates while its suppose to be stablecoin. stablecoin had been a great hedge for traders specially in the bear market, you wouldn't want your money drained out while the rest of the BTC holders are shorting.

[HabiebRiziq]

I think everyone has their own strategies to be able to stay in cryptocurrency and at bear market conditions. Some people will definitely prefer stablecoins when the bear market is arguably the right way to survive in cryptocurrency and to become our assets so as not to lose a lot of losses, but some people just don't want to do it and they prefer to stay trying to make a profit from coins that they think are potential, although this is arguably more risky but maybe they think it's something they are used to doing.

[d3nz]

I highly agree that those stablecoins is the definite solution for the bear market and it is much profitable than those altcoin who are only for pump and dump scheme which is i think bad for the market.

And i think that only the top ranked coins is the one who can make it and stabilize their value even thou the market is in crisis.

[judaspriest]

Sorry to ask cause I only have a little knoweldge about stable coins. Do they increase/decrease they value just like any other coins or not since they are pegged to a certain currency? If they are not decrease their value, there are any chances it would make cryptocurrency stable not definitely a solutions for a declining market.

Crypto currencies also have their own volatility, but volatility is very different from other crypto currencies, stable coins tend to be FIAT original prices on the stock market, so don't worry if you keep stable coins during the bear market

[Abiky]

To some extent  stable coins have gone as far as helping maintaining traders or investors capital. Imagine BTC dumping and you already converted to stable coin, that would be a sign of relief to the trader or investor because you don't have to watch the value of your coin keep reducing there will be some calm in you.

That's certainly true, mate. There's some level of convenience when using stablecoins for all of your crypto trades. Sometimes, it's much better to use a stablecoin than Fiat directly as you can gain instant access to the value of $1 USD without having to wait a couple of days to receive money in your bank account. But I'd have to admit that there are too many stablecoins on the market, which is more than enough for the average trader/investor. Only exchange-backed stablecoins will survive in the future, while the rest could become worthless in the long run. I used to remember a stablecoin called "NuBits" that was always worth $1 USD. But its model failed in the long run, mostly because it was not backed by a reputable exchange in the mainstream world. Everything was based on pure algorithms and buying back NSR shares. It's today where 1 USNBT is worth less than $1 USD, leading to undesirable losses among early investors of the same.

I hope that neither DAI or Tether would turn out to become like NuBits in the future, as it will become disastrous for the reputation/image of the crypto industry. As long as stablecoins retain their price of $1 USD per coin, they'll be the most ideal solution for a bear market. Your last resort would be to cash out your crypto towards your bank account for safekeeping. All in all, stablecoins prove to be of great use both for the average trader and serious investor alike. Just my opinion

[potatopower]

I don't think stablecoin is a good solution in the bear market because we can swap it with real dollars, btcs and altcoins in some exchange. So while crypto price is still affected by many things, I recommend that you don't keep your stablecoins as an asset. If you want your investment to recover, then go all in the real dollar. If you still want to maintain a stable coin as an asset, what if some country release a new law to shut off that stable coin, then who can guarantee that you can get your money back.

[gundala]

--

What are your thoughts?

Everything must have a risk, friend. As a day trader, stable coins are quite helpful when suddenly there are unexpected market movements, there are times when all prices suddenly go down, that's the right time to turn it into a stable coin, with the note that it is only temporary and for a relatively short period of time. So it does not come out of the market completely, when price movements have begun to look good and conducive it can be quickly converted into coins or other tokens as desired.

[Darooghe]

In additional, I would to say, without the option to close your positions without getting back to Fiat, Crypto will never hit mainstream. The problem is that there are no easy to implement solutions, USDT is not safe enough, and the likes of Basis even if they deliver are too complex for the average joe to understand. Making a crypto equivalent of fiat and calling it stable is about as absurd a concept as I could think of. The sooner the speculators are ejected and people just start spending crypto, the more stable it will become. If that means a price crash then so be it.

[Ashong Salonga]

In a dreaded bear market that's lasts a long time, do you think that stablecoins are the definite solution for preserving one's investments?

So far, there has been a few stablecoins like Tether and NuBits which have gone lower than $1 at rare occasions. For investors depending on stablecoins as safe-haven assets against a bear market, this brings some disappointment. Still, stablecoins are able to retain their value against the USD most of the times. If they remain as is, then one could simply pour money into stablecoins to protect yourself against a long-lasting bear market. If prices for cryptocurrencies on the market go even lower than usual, you can even sell your stablecoins back into crypto to get more coins for your money. But this might turn to be extremely risky in a volatile crypto market.

What are your thoughts?

For me, due to the personality I do have, I would still consider having and holding into cryptocurrency despite of the bear market that we can experience in no time. I know the risk being associated on getting into this industry I am currently into and for me, I do love taking risks and challenges which I can acquire on staying with cryptocurrency. Although stable coins can do provide me stability in terms of price, I think it is just like having fiat on my hand that just take small improvement which is for me looks ordinary and boring. But I do consider having stable coin at the same time keeping in hand my cryptos. Bear market have lots of lessons to teach us so we must not be afraid on being in a situation like that because it is just a normal scenario we must take to be able to improve our intellectual capacity and at the same time seein a world out of our boxes.

[Abiky]

Everything must have a risk, friend. As a day trader, stable coins are quite helpful when suddenly there are unexpected market movements, there are times when all prices suddenly go down, that's the right time to turn it into a stable coin, with the note that it is only temporary and for a relatively short period of time. So it does not come out of the market completely, when price movements have begun to look good and conducive it can be quickly converted into coins or other tokens as desired.

Agree. There's always a risk involved when trading crypto. After all, prices are extremely volatile across the market. Thanks to the introduction of stablecoins, people can obtain the convenience of the USD's stability and the censorship-resistant design of crypto. While the concept is still relatively new, cryptocurrencies that are pegged to the value of $1 USD serve as great alternatives to mainstream Fiat. At times, prices may go a little lower than $1 USD giving you the opportunity to "reap the profits" within a short time frame. Tether, bitUSD and several other stablecoins have a small fluctuation in price at times where the bear market is threating most cryptocurrencies' prices among popular exchanges.

Of course, we cannot rely on stablecoins in their entirety as they're not guaranteed to secure one's investment for the long term. For this, the real USD is the winner. You can simply cash out your crypto to USD with your bank account to completely secure your investment. If stablecoins decline in price within a short time frame, you can use the money from the bank to buy more coins and sell them once everything heads back to normal. Repeating the process should allow you to maintain your investment even when a bear market threatens the entire crypto space.

Nonetheless, with the introduction of a regulatory framework for stablecoins, it seems that they'll be here to stay for a very long time. The industry is ripe for innovation in every way possible. Once serious investors see stablecoins as a "safe haven" alternative to the real USD, they'll join the crypto space in mass. As a result, we'll see a higher market valuation for crypto faster than you could imagine. Hence, stablecoins are the most definite solution against a bear market for investors, traders, and the average Joe. Just my thoughts

[Polar91]

I see stable coins are more regulated compared to investment cryptocurrency. Though, they are called investment, stable coins are more suitable in terms of business investment and day to day transaction. But if we think about the bear market, the function of a stable coins turns out to be the savior of a fallen cryptocurrency market in a short term, and investors think it might be a safe haven. Which indeed for me is true. Stable coins do really serve as the solution to save the profit, but is not a solution to stop and make the bear market bull again.

[Abiky]

I see stable coins are more regulated compared to investment cryptocurrency. Though, they are called investment, stable coins are more suitable in terms of business investment and day to day transaction. But if we think about the bear market, the function of a stable coins turns out to be the savior of a fallen cryptocurrency market in a short term, and investors think it might be a safe haven. Which indeed for me is true. Stable coins do really serve as the solution to save the profit, but is not a solution to stop and make the bear market bull again.

That's certainly true, mate. Stablecoins are more regulated than traditional cryptocurrencies being traded on the market today. This is great for the mainstream adoption of crypto and Blockchain technology as institutional investors will be able to gain the advantage of traditional Fiat and crypto at the same time. I believe that a stablecoin provides far better use cases than Fiat itself.

By leveraging Blockchain technology, stablecoins are able to provide a solution for traders, investors, and individuals alike which is censorship-resistant and tied to the value of $1 USD. Not all stablecoins are perfect, but they seem to be improving every step of the way. With enough demand for stablecoins, they'll be here to stay for a long time. As long as they're able to retain their value of $1 USD per coin, they'll prove to be extremely useful at times where crypto prices are declining at a fast rate. It's much more convenient to save your money on a stablecoin than a bank account directly. My main concern is their long-term price across the crypto market. If stablecoins remain stable in price forever, then they're the definitive solution against a bear market. Otherwise, you'll be better off cashing out your crypto into Fiat for safekeeping.

Nonetheless, time will tell us if stablecoins will survive or not. Everything will depend on government regulations and mainstream use. If regulations become too fierce, I doubt stablecoins will take off in the mainstream world. The same thing could be said if adoption for stablecoins is low. With Facebook's announcement of Libra, the world is becoming aware of stablecoins as the perfect solution to crypto's volatility and traditional Fiat. Just my opinion

[Twinkledoe]

--

What are your thoughts?

Everything must have a risk, friend. As a day trader, stable coins are quite helpful when suddenly there are unexpected market movements, there are times when all prices suddenly go down, that's the right time to turn it into a stable coin, with the note that it is only temporary and for a relatively short period of time. So it does not come out of the market completely, when price movements have begun to look good and conducive it can be quickly converted into coins or other tokens as desired.

That is, if the stable coin you are holding has real backing of assets. Remember, USDT before, they admitted that it was not fully backed by USD. What if you are holding a different stable coin other than USDT? Do you really think that stablecoin has their assets to back up when something goes awry?

https://breakermag.com/tether-now-admits-its-not-fully-backed-by-dollars/