The fundamental question behind stablecoins and their destiny for disruption remains: why? Why do we need stablecoins at all? The world was getting on fine without them. It was more or less, stable.
The bear market of 2022 following a virtually unbelievable v-shaped recovery following the first global pandemic of several generations brings into question the sustainability of said recovery. Pumping helicopter (free) money into a global consumer base alongside additionally free money from central banks everywhere challenges the concept of purchasing power.
Meaning, that purchasing power, the worth of your dollar or euro, should over a short-term remain stable while you accept small deteriorations over time.
However, the USA is currently experiencing, or suffering, a 9.1% inflation rate. All else held equal, this implies a 9.1% deterioration in your dollar over the last year. Another problem: we’re not yet sure if inflation has yet peaked, whether in the USA or abroad.
So how can stablecoins help? What’s the point?
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