Do you know what a stable currency is? Come on, I'll tell you! by Karupanociten
One of the most feared things by many investors is uncertainty, not knowing if an investment will generate dividends or not if you will be able to recover the investment. Hence, a lot of time and resources are invested in trying to make reliable predictions regarding the potential of a project. The world of blockchain has many and varied projects, some are just “booby-hunting” traps, others on the contrary are serious and well-developed, projects that are worth supporting and investing.
But... this great diversity also generates a lot of anxiety for investors, seeing how crypto goes from being worth $ 0.00001 to $ 10 in a month is something very appetizing, but when you are saving and the opposite happens ... it is a great catastrophe! That is why looking for mechanisms to offer alternatives that allow investors to keep funds in the blockchain with the security that they will not lose their value, many projects have created the so-called “stable coins”, would you like to know more about them? stay with me and together we will learn about them.
What is a Stablecoin?
When a cryptographic asset is designed in such a way that it maintains a fixed exchange value or with very little variation, it is considered to be a stable currency. Now, like the rest of the altcoins for it to be considered as such, the currency must not only be stable but also be decentralized, offer security to operate, and be generated by a solid project.
A stable coin provides its holders with the benefits of being able to carry out operations within the blockchain environment and all its benefits (confidentiality, immediacy, commission savings, ease of access, etc.) with the peace of mind of having the certainty that their Coins will maintain their value in the face of market price rises and falls.
Why are stable coins important to the blockchain?
One of the benefits of any currency is its ability to represent a reserve of value that facilitates the exchange of goods and services with the peace of mind of not losing capital in each transaction, hence we must be clear that many investors are looking for a means of payment " insurance ”with which they can acquire other crypto assets that they will use to generate money through market speculation.
As we already know, within the cryptographic market large amounts of money can be generated from knowing when and how to invest, taking advantage of the volatility of the market, but both for investors who are just starting in this type of business, as well as those who want to go By generating “savings” in cryptocurrencies, being able to count on a mechanism to safeguard the value of your investment, is always well received.
Likewise, stable coins, thanks to their decentralized and easily accessible characteristics, offer a solution for investors in inflationary economies in which, due to government regulations, it is difficult for them to be able to exchange their fiat currencies for other more stable fiat currencies to protect your financial capital.
It's not just about generating profits
Perhaps for us, who are already within a blockchain environment, it is natural that a good investment in crypto assets generates good dividends, but for many people, it is inconceivable that “something that is not seen” is capable of generating or mobilizing so much money, first they think is that either it is a scam, or it is a speculative bubble. Hence, they view any operation with crypto assets with doubt or suspicion.
Hence, being able to count on stable coins, in addition to providing efficient payment mechanisms and value reserve with which we can make transparent and reliable transactions, generates in investors and the general public the confidence and tranquility necessary to "venture" into the negotiations with crypto assets, something like a kind of "lifeboat" in the face of market speculation.
Did you already know stable coins? What do you think about their use within blockchain projects? Would you like us to continue talking about this topic? Come on, give us your opinion! See you in the comment box
We keep reading!
Hi @karupanocitizen
Important topic you have developed. Many people do not know what is a token, a stablecoin, an Altcoin, among so much diversity, for some everything is cryptocurrency and already.
But it is good to know that there are diversities, that some are protected to gold, others to the dollar, the euro, and that is how their prices are maintained with some stability.
Thank you very much for your comment my very dear friend @josevas217, constant learning is one of the fundamental bases for our growth on this platform, thanks to your recommendation I will continue to generate this type of content so that we continue together, growing within the blockchain.
Have an excellent start to the week !!
Greetings friend, very good topic, really few see the difference between cryptocurrencies and not all are to speculate with the price, something very important for those seeking a backup for their investments but keeping them in some crypto asset.
Thanks to you friend @emiliomoron for taking the time to read my publication, certainly you have to know how the different types of currencies work in order to know when and how to invest, as well as the uses we can give them.
Nice to have you here, have a happy day.
Wonderful information about stable coin. This type of knowledgable topic is much required for the people who don't know the more details about crypto and they are beginners in crypto. I Hope you will cover other aspects of crypto too..
Thank you friend @luckyali for your stimulating comment, indeed they are topics that must not only be discussed but reviewed to keep us always aware of how our blockchain environment is managed, in case you like to read them this week I will be making publications to delve into this topic.
Have a very happy start to the week !!
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Upvoted 👌 (Mana: 0/6) Get profit votes with @tipU :)
Excellent delivery that you share with us, very valuable contribution as we mostly depend on stable coins to get good dividends from blockchain. We will continue reading
Thank you very much for your kind comment friend @madridbg, soon I will make other publications with this same theme in case you like to read them, we continue reading!
Hi @karupanocitizen
I just bumped into one of your older posts - one which attracted my attention. Hopefully you still will read this comment :)
It's very true, that lack of certainty is one of the main reason why investors and business owners are not willing to take much risks and often are putting their investments / company exansion at pause. I wish more of our politicians would understand it.
Based on my experience, those cryptos which are making such a huge gains are the ones with pretty much no volume. Which means, that those who would like to take their profits may end up not being able to sell their tokens. And in panic they will drop price to super low levels. After all - nothing scares more than seeing that there are no buying orders.
Thanks for your great introductions to topic of stable coins. I must admit, that idea behind stable coins seem to be simple and honest. However, the fact that some stablecoins (starting with letter T) is avoiding any sort of public audit is a huge concern to me.
In theory, stable coins are supposed to have backing 1 to 1 with usd. But I hardly doubt that any of them do have such a backing.
I can easily imagine scenario similar to "bank runs" in the past. It may be very painful moment.
Interesting read. Upvoted already :)
Cheers, Piotr
Greetings my dear friend Piotr, ¡grateful that you take a tour of my blog!
ja ja ja, ¡don't worry about that!, I highly value the comments you make to my posts, so I not only read them completely, but I also reply to each one of them.
This example I put it because basically, it is what many of the blockchain's world think, that it is only speculative values, of a "bubble" that must be exploited before it explodes.
But I share your opinion, as I get to know more about this cryptographic world, the more coincidences I find with the real world, the investments that offer such high-profit margins are often not solid projects, but a mere speculative game (like the currency of the puppy ;) ).
On the other hand, I also question a lot of the guarantees offered by some of the promoters of some "stablecoins", this is not good for the system, because as you say, it is very similar to the practices of some banks that I wish better not to comment. Hence, many of these projects systematically reject the realization of any serious audit, thus sending negative signals to investors who trust in said project.
Over time we will likely see blockchain projects dedicated solely and exclusively to conducting audits, fraud detection, and project certification, it would be a great step!