StinkyFingerItchyBum

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Joined 6 months ago
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Cake day: February 26th, 2025

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  • Stablecoins are a type of cryptocurrency pegged to a country’s national currency, or to commodities like gold. The idea is that their value is linked to a stable asset, and is therefore less prone to volatility than regular crypto.

    What a sham. Currencies have their own problems, but have the backing of the state. Gold is the real deal in every way. When the tides go out and we find who was swimming naked, holders of real assets will be fine, holders of derivatives will find themselves ruined.

    Even calling it “stablecoin” reeks of scam. Like the scammy “Honest” in the used car salesman’s name. “Trust me”. From wikipedia:

    In July 2025, the United States passed the GENIUS Act, a bill which allows banks and other financial institutions to issue stablecoins backed by fiat currency or other high-quality collateral, such as US Treasuries.

    Lol, calling it the “Genius” bill is really calling buyers of it idiot suckers.

    Pegging a crypto to gold can’t work. In the good times, it satisfies demand for gold and gold like assets. If it has convertability, meaning I can trade my crypto for gold on demand similar to the old gold standard of currency. Then it has to be limited in number to real gold and is no different than an easily tradeable certificate of gold deposit. Certified by who? If it is pegged to the price of gold, but no limited to the amount of gold being held, then in the good times it dilutes the real price of gold, and in the bad times it’s worthless because the price link to gold and or convertability to gold can’t be maintained. Those who hold real gold have an asset, those who own gold pinned crypto have a tragic story to tell of how they bought into a scam.

    If it’s crypto pegged to fiat, then it’s just fiat that can be stored digitally on a drive as opposed to stashed in one’s mattress. Instead of somewhat trusted banks backed by the state, the exchanges have a different risk profile including the technology itself.

    In the end they are all just digital confidence scams.