Are stablecoins safe?

[ethereumhunter]

You don't need to worry about whether stable coins are safe or not. Maybe what makes you feel insecure is that you are keeping stable coins on an exchange which could get you into trouble at any time. But if you keep stable coins in other wallets, it will be safer.

But if "safe" here is about government regulation, I guess it will be up to each government to regulate cryptocurrencies in their country. And as long as your government allows crypto, it will be safe. The use of stable coins is to anticipate a decline in the market so that the value of our assets will not be too affected and we can also use stable coins to buy decreased coins.

[mindrust]

Nope. They aren't safe. Nobody in the right mind would see them "safe". First of all, we don't know if these tokens are backed by any real assets. Ideally they should back them with USD only but that ship has sailed long time ago. They say these tokens are backed by government bonds mostly and that itself is not bad. However, as we have seen with LUNA, FTX etc. these scammers back their assets with their own printed altcoins. So, the issuer of tether, very well be backing tether with other alts or even btc. But we use tether to buy btc and if btc uses tethers to back itself, I mean, that would be pretty fucked up.

[AzamNurWahid]

I personally often use stabilo coins at certain times to stabilize the financial value that I have.  But for the type of stable coin that I choose, usually USDT which already has credibility value.  And to use other stable coins, maybe I still need time

[Ayers]

Just look at Luna(UST) then I reckon you'd get your answer. It may be a single instance, but it's still an instance nonetheless to take into account. I'd honestly just avoid holding any stablecoins for a long period of time if possible, I've only ever used stablecoins when paying/moving stuff, the rest of what is in my wallet is always invested in some crypto for the long term.

Here's an old post by mk4 about stablecoins
https://bitcointalk.org/index.php?topic=5204055.0

UST is an algorithmically stable coin backed by bitcoin and many altcoins, so when the market fluctuates, it is bound to crash, UST was warned a lot before it collapsed. UST is not like the rest, but after all, stablecoins are centralized so there is no guarantee for us, they can be frozen by the issuer at any time. But from my point of view, investing in crypto is always risky, holding altcoins will not be safe for you as altcoins like Luna or FTT are not much better than stablecoins.

[MFahad]

Some Stable coins are safe as far as crypto system remians like Usdc and Dai which are backed by. Usdt and some others stable coins are not fuy secure and any time it can rugged like Ustc. After Ftx collapse I withdraw my 80% stable coin to fiat and now just using 20% for trading etc.

[fzkto]

Some Stable coins are safe as far as crypto system remians like Usdc and Dai which are backed by. Usdt and some others stable coins are not fuy secure and any time it can rugged like Ustc. After Ftx collapse I withdraw my 80% stable coin to fiat and now just using 20% for trading etc.

It seems to me that these stabelcoins are safe until something bad happens. LUNA UST, for example, was also said to be safe and no one could take your money from you. But trouble came when it wasn't supposed to. USDC is centralized, so your funds can be blocked, just like USDT. I agree about DAI, it is the only decentralized stable that is fine for now, but nobody knows what can happen with it in the future.

[pawanjain]

The only time I am using stable coins is when I am trading something for which BTC pair isn't available or at the time of withdrawing it to cash.
The rest of the times I hold the coins. I mostly prefer USDC and USDT is my second priority. Rest all are out of my bucket.
I cannot really say if stable coins are really stable or safe or not because of the recent events of LUNA and FTT.
But if you wanna buy stable coins  then prefer USDC and that too only for a very short time.

[MoonOfLife]

Hello Crypto Fam.

So, the FSB has released a recommendation on stablecoin regulation. They are doubting the notion that stablecoins are "stable," arguing that issuers lack the necessary tools to keep their stablecoin peg at all times, implying that no stablecoin currently meets their recommendations.

This is what they said about it:

“Most existing stablecoin issuers promise (implicitly or explicitly) to maintain a stable value, typically relative to a single fiat currency. However, many of these existing stablecoins are issued by unregistered and unlicensed entities and do not have credible mechanisms to support their promise of price stability.”

What do you guys think about this? Would you recommend the use of stablecoins or they just aren't worth the risk?

Original source of the story:

https://tokenist.com/fsb-says-no-stablecoin-currently-passes-its-recommendations/

Bitcoin is also not safe let alone stable coins, once investing in crypto you should know that this market is full of risks. Your assets can be lost, disappeared or hacked at any time. In my opinion, stablecoins are altcoins so their safety is considered similar to altcoins. Do you believe altcoins are safe?

[Antonas1]

For me now, stable coins are not useful. Why do we exchange BTC/altcoins into tokens like USDT/USDC/UST, or whatever, when they have no difference with fiat? I'd rather convert my coins directly to fiat.
Is it safe? No, because the 1:1 claim against the US dollar is just a unilateral claim. Actually, you have read about it in an article that you include.

[Sayeds56]

For me now, stable coins are not useful. Why do we exchange BTC/altcoins into tokens like USDT/USDC/UST, or whatever, when they have no difference with fiat? I'd rather convert my coins directly to fiat.
Is it safe? No, because the 1:1 claim against the US dollar is just a unilateral claim. Actually, you have read about it in an article that you include.

Though stable coins relatively less risky as they are supposed to be backed by Fiat currencies, but we can't say that they are 100% safe in particular algorithmic coins like UST. We have seen in the recent past how billions of dollars were wiped out from market within days when UST peg was broken. One thing we need to keep in my mind that crypto highly rewarding but highly risky too so secure your investment/trade buy using all risk management tools.

[o48o]

What do you guys think about this? Would you recommend the use of stablecoins or they just aren't worth the risk?

Stablecoins are one of the reasons we has as much liquidity and high prices as we do. I don't think that most people are against regulating/auditing them so that endless fud on them would end. And if trust on stable coins would increase, so would the market price of most coins.

Current situation is that anyone can just create algorithmic stablecoin and have no rules that requires them to provide any proof of reserves. Which is absurd when you think about it.

This will now change and obviously there will be some cryptopunks against it, as not only governments want to audit the reserves. They will most likely end up regulating more anyone asked for. But it's not like we have an option to stop them to do that.

[tvplus006]

You don't need to worry about whether stable coins are safe or not. Maybe what makes you feel insecure is that you are keeping stable coins on an exchange which could get you into trouble at any time. But if you keep stable coins in other wallets, it will be safer...

If you think that storing a stablecoin on your wallet is safe, then you should remember such stablecoins as UST, which lost its peg to the dollar and crashed. In that case, no matter where you stored UST, you ended up losing your money.

[posi]

Some Stable coins are safe as far as crypto system remians like Usdc and Dai which are backed by. Usdt and some others stable coins are not fuy secure and any time it can rugged like Ustc. After Ftx collapse I withdraw my 80% stable coin to fiat and now just using 20% for trading etc.

It seems to me that these stabelcoins are safe until something bad happens. LUNA UST, for example, was also said to be safe and no one could take your money from you. But trouble came when it wasn't supposed to. USDC is centralized, so your funds can be blocked, just like USDT. I agree about DAI, it is the only decentralized stable that is fine for now, but nobody knows what can happen with it in the future.

As you say nothing is safe in this market and I agree with that, everything will be fine until it crashes. It can be said that there is no such thing as absolute security in this world, everything is relative and the crypto market is uncertain and unsafe. Once entering the market, we should remember that there is no concept of eternal security here even if it is decentralized. I have an old piece of advice for the OP, only invest with what you're willing to lose.

[Sang Prabu]

Since I know the stable coins, I immediately move the assets to the coin stable, and several times I can save the assets so as to avoid greater losses, and I think stable coins that have strong power are USDT and BUSD, So the conclusion is that the coin stable is very good and safe.

[albon]

For me now, stable coins are not useful. Why do we exchange BTC/altcoins into tokens like USDT/USDC/UST, or whatever, when they have no difference with fiat? I'd rather convert my coins directly to fiat.
Is it safe? No, because the 1:1 claim against the US dollar is just a unilateral claim. Actually, you have read about it in an article that you include.

Though stable coins relatively less risky as they are supposed to be backed by Fiat currencies, but we can't say that they are 100% safe in particular algorithmic coins like UST. We have seen in the recent past how billions of dollars were wiped out from market within days when UST peg was broken. One thing we need to keep in my mind that crypto highly rewarding but highly risky too so secure your investment/trade buy using all risk management tools.

Yes, there is nothing 100% safe in the crypto market. We have to agree on that. Also, do not forget that USDT lost its peg previously, and its price decreased to $0.96, and its team confirmed that it will restore its price again by buying back from its own reserves. USDT is one of the largest cryptocurrencies in The crypto market after Bitcoin and Ethereum, and if we assume that something happens to USDT, I see that it will be a disaster and the end of crypto. At the present time, the price of USDT remains stable, but for how long? No one can answer this question, so what I advise is not to put our money in one stablecoin and divide it into some other stablecoins.

[Ultegra134]

Just look at Luna(UST) then I reckon you'd get your answer. It may be a single instance, but it's still an instance nonetheless to take into account. I'd honestly just avoid holding any stablecoins for a long period of time if possible, I've only ever used stablecoins when paying/moving stuff, the rest of what is in my wallet is always invested in some crypto for the long term.

Here's an old post by mk4 about stablecoins
https://bitcointalk.org/index.php?topic=5204055.0

You're comparing an algorithmic stablecoin (UST) with established stablecoins such as USDT and USDC. The latter are deemed safe enough to use and have hardly ever lost their $1 peg. Even when they did, they quickly recovered. That's not the case with algorithmic stablecoins, though, which can be deemed extremely risky because they rely on two types of tokens: a stablecoin and another token supporting the aforementioned stablecoin. There are several examples of failed ones out there, such as BoltDollar or UST. It's easy to mention that plenty can go wrong with them, and they're not actually guaranteed to have a secure 1:1 dollar peg (see USDN, FEI, or DEI).

[goaldigger]

Since I know the stable coins, I immediately move the assets to the coin stable, and several times I can save the assets so as to avoid greater losses, and I think stable coins that have strong power are USDT and BUSD, So the conclusion is that the coin stable is very good and safe.

Hard to say its 100% safe after all the big issues about stable coins, we might safely say it for now but hard to predict the future, as many says Bitcoin is the only safe coin because its purely decentralized and even big investors believes on the same thing. Holding stable coins might save you from volatility, but again you should still analyze it before holding.

[devil2man]

At the moment many stable coins are no longer "stable" their value against the dollar has dropped slightly (usdt) but they are one of the safest things in the world of cryptocurrencies, for me a point of reference

[Eureka_07]

<snip>

Tether (USDT) is different from these algorithmic stablecoins.
Algorithmic stablecoins are backed by other coins to maintain its price to it's promise value. This method of buying back affects the value of the both coins which can sometimes cause for the fall of an stablecoin just like what happened to UST. That is one reason why it is less trustworthy than USDT which uses its own reserves to buy back and regain being 1:1 to US dollar.

[Jackl87]

Hello Crypto Fam.
So, the FSB has released a recommendation on stablecoin regulation. They are doubting the notion that stablecoins are "stable," arguing that issuers lack the necessary tools to keep their stablecoin peg at all times, implying that no stablecoin currently meets their recommendations.
What do you guys think about this? Would you recommend the use of stablecoins or they just aren't worth the risk?

The simple truth in my opinion is, that no crypto stable coin that exists right now is really 100% safe, so waht the FSB is saying is definitely true in my opinion. I mean just look at what happened with Terra Luna a few months ago. They could not hold their stablecoin at the dollar peg anymore and that killed the whole company and brought the rest of the crypto market down. Without the events of Terra Luna i think FTX would not be bankrupt today.
Also USDT has also lost it's PEG for a few days. According to coinmarketcap it is at 0,9996 at the moment. Of course this is only a very small deviation from it's peg but still. As long as their is no official digital $ or € we won't have real stablecoins.